Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
High-income country - it has a high GDP which indicates wealth
B
Upper-middle-income country - it likely has a diverse economy
C
Lower-middle-income country - despite high GDP, GNI shows income disparity
D
Low-income country - high GDP does not correlate with income distribution
Understanding the Answer
Let's break down why this is correct
Answer
A country with a high Gross Domestic Product (GDP) but a low Gross National Income (GNI) per capita is often classified as a developing country or a middle-income country. GDP measures the total economic output within a country, while GNI per capita reflects the average income of its citizens, including income earned abroad. If a country has a high GDP, it means it produces a lot of goods and services, but if the GNI per capita is low, it suggests that most of the wealth is not reaching the average person. For example, a nation rich in natural resources might export them, boosting GDP, but if the profits are not distributed fairly, the citizens may still be struggling financially. Therefore, this situation indicates that the country has economic activity but needs to improve the income levels of its population.
Detailed Explanation
This country has a high GDP, meaning it produces a lot of goods and services. Other options are incorrect because People might think high GDP means everyone is wealthy; This choice suggests a balanced economy.
Key Concepts
Economic Productivity Classification
Gross Domestic Product (GDP) and Gross National Income (GNI)
Income Disparity
Topic
Economic Productivity Classification
Difficulty
easy level question
Cognitive Level
understand
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