SHARJAH INDIAN SCHOOL-JUWAIZA

Submission Note: ECONOMICS

CHAPTER 1 DEVELOPMENT

Learning Objectives:
The students will be able to;
Define development
1. Describe the developmental goals of different categories of people
1. Our development is the earth’s destruction.
Do you agree with the given statement? Give reasons in favour and against the statement.
Ans: Reasons in favour of the statement:
a) Over consumption and excessive use of natural resources by humans for
developmental purposes have led to environmental degradation, pollution and climate
change, which pose a severe threat to the health and wellbeing of our planet.
b) Economic growth and development has often resulted in the destruction of eco
systems, loss of bio diversity and the displacement of indigenous communities, leading to
damage to the Earth’s natural systems.
Reasons against the statement:
a) Development and progress can also lead to positive environmental outcomes, such
as the use of renewable sources and the adoption of sustainable technologies that
reduce pollution and greenhouse gas emissions.
 b) Humans have the capacity to innovate and develop solutions to reduce
environmental damage caused by development, such as afforestation, conservation
and restoration efforts that can help restore damaged ecosystems.
2. The table below shows the income of the citizen of two countries, A & B, assuming that
they have only 4 citizens.

a. Calculate the per capita income of both the countries.

b. Which country has a higher per capita income?
c. Which country has a more equitable distribution of income?
d. Is the answer for (b) and (c) the same? Give reasons.
ANS.
a. Country A: 2,375
Country B: 10,540
b. Country B
c. Country A
d. No, because despite having a high per capita income, country B has a wide gap between
the rich citizen II and the rest of the citizens.
3. How does Human Development Report give a holistic view of development?
The Human Development Report published by UNDP compares countries based on the
educational levels of the people, their health status and per capita income.

The HDI attempts to rank all countries based on three goals or end products of development;

(1) longevity as measured by life expectancy at birth, (2) knowledge as measured by adult literacy
and (3) standard of living as measured by real per capita income.

4. ‘Money cannot buy all the goods and services that one needs to live well.’ Explain
• Money or higher per capita income cannot buy a pollution free environment or good health.
• Money cannot ensure that you get unadulterated medicines.
 Money may not be able to protect us from infectious diseases.
 Money cannot buy peace and democracy.
• Per capita income of Haryana is higher than Kerala, but still, it lacks behind in education
and health facilities.
• In Kerala, out of 1000 children born alive,7 die before completing one year of age but in
Haryana the proportion of children dying is 30.
5. What is average income or per capita income? Why do we use averages? What are
the limitations of per capita income?
Per capita income/Average Income – It is the total income of a country divided by the total
population. This criterion is used by the World Bank.
Importance of Average Income- Average income is an important criterion for development
because countries have different populations so total income or national income will not tell
us what an average person is likely to earn. This is known only by average income.
Drawbacks or limitations-
* Per capita income does not show the real growth of an economy because it does not
consider various issues like health, education and literacy.
* It hides disparities- It does not tell us how the income is distributed among the people.
Production of some goods does not add to the economic welfare of the country eg. Tobacco,
arms etc.
iii) It excludes all non-marketed goods and services, even though they may be important for
human happiness and better quality of life.
iv) It covers only the economic aspects ignoring peace, health, environment, education,
longevity, etc.