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Scenario: the Price of a Standard Basket of Goods in Country

question 158

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Scenario: The price of a standard basket of goods in Country A is 10 pesos. The price of the same basket of goods in country B is 25 francs and $5 in the United States. Country A has an income per capita of 60,000 pesos, and country B has an income per capita of 100,000 francs. Assume full employment in both countries.
-Refer to the scenario above.Which of the following statements has to be true if we plot the relationship between income per capita (x-axis) and the Human Development Index (y-axis) ?


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