UPSC Prelims 1997 · General Studies

Question 46: Economy and Social Development

Human Development Index comprises literacy rates, life expectancy at birth and

aGross Domestic Product per head in US dollars

bGross Domestic Product per head at real purchasing power

cGross National Product in US dollars

dNational Income per head in US dollars

AnswerThe answer is (b).

The Human Development Index as built in the 1990s combines three things: literacy (knowledge), life expectancy at birth (health) and income, measured as GDP per head adjusted for real purchasing power. Adjusting for purchasing power matters because a dollar buys different amounts in different countries. Remember that HDI income is PPP-adjusted and not plain dollar GDP.

Why each option is right or wrong

(a) Plain GDP per head in US dollars does not adjust for local prices.
(b) Right: GDP per head at real purchasing power is the income part of the HDI.
(c) GNP in dollars is a total, not a per-head figure, and ignores purchasing power.
(d) National income per head in dollars again ignores purchasing power.

Worth knowing: The HDI was revised in 2010; it now uses years of schooling and gross national income per head (PPP), so the question's list is out of date.

Explanation: written by UPSC Grade, not by UPSC.

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Source: UPSC, Civil Services (Preliminary) Examination 1997, General Studies. UPSC's own paper isn't online; the words are from a published compilation. The paper on upsc.gov.in.