Per capita income (PCI):

• The way national income is an indicator of economic growth, the per capita income is an indicator of national economic development.
• The division of gross national income with total population of that nation is called the per capita income.
  Per captia income =  \(\frac{Gross\, National\, Income}  {Total\, Population}\)

Example:

• Suppose the national income of a country in a given year is ₹ 60,000 crores. The population of that country in that year is 2 crores.
• Then, Per Capita Income (PCI) = \(\frac{60,000\, crore} {2,000\, crore}\)  = ₹ 30,000
• The per capita income of the given country is ₹ 30,000. It means that on an average every citizen of this country earns an income of ₹ 30,000 during a year.
• Thus, per capita income is the average income per individual. Since, PCI is an average income of entire nation, some individuals might be earning less and some more. Hence, PCI is just an indicative figure and not a true figure of individual income.
• If the per capita income is high, the citizens will able to afford more goods and services and their standard of living will improve.