Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Indian Economic Development: Poverty

Question:

Which of the following is used by the "Government" to identify the poor in the country?

Options:

Monthly per capita expenditure

Monthly investment expenditure

Monthly consumption expenditure

Monthly disposable income

Correct Answer:

Monthly per capita expenditure

Explanation:

The government uses Monthly Per Capita Expenditure (MPCE) as a proxy for the income of households to identify the poor. Economists state that a major problem with this mechanism is that it groups all the poor together and does not differentiate between the very poor and the other poor.