Author Question: In a short essay, describe the four reasons why per-capita income is not always the best indicator ... (Read 127 times)

TVarnum · **on:** Jul 7, 2018

In a short essay, describe the four reasons why per-capita income is not always the best indicator of an emerging market's potential.

What will be an ideal response?

Question 2

In a short essay, describe the risks and challenges of doing business in emerging markets. What strategies help firms enter emerging markets successfully?

What will be an ideal response?

vish98 · **Reply #1 on:** Jul 7, 2018

Answer to Question 1

a. Numbers must be adjusted to account for the existence of an informal economyeconomic transactions that are not officially recorded and therefore left out of government calculations of a nation's GDP.
b. The great majority of the population is on the low end of the income scale in emerging markets (and developing economies). The mean or average does not accurately reflect a non-normal distribution; often, the median income would reveal a better picture of purchasing power.
c. Household income is several times larger than per-capita income because of multiple wage earners in these countries.
d. Governments in these countries may underreport national income so they can qualify for low-interest loans and grants from international aid agencies and development banks.

Answer to Question 2

This is great. Thanks