This is a pie-chart showing the age distribution of population. The total population is 120 million. The official school-leaving age is 18 years while the official retiring age is 55 years.
(a) From the above information, calculate the:
(i) Population of children between 0 and 17 years.
(ii) population of old people (55 + years);
(iii) work-ing population (18 – 54 years) .
(b) what is the economic implication of the above population structure?
Explanation
(a)(i) Population of children between 0 and 17 years =\(\frac{162}{360} \times \frac{120}{1}\) = 54 million
(ii) Population of old people (55 + years)
= \(\frav{108}{360} \timees \frac{120}{1}\) = 36 million
(iii) Working Population (18 - 54 years) = \(\frac{90}{360} \times \frac{120}{1}\) = 30 million
(b) The population structure in (a) above shows that the dependency ratio is high. Out of the total population of 120 million, the population of the dependant is 90 million. The economic implications are:
(i) The working populations will pay higher amount of tax to take care of the dependants.
(ii) The larger the group of de-pendants, the greater the expenditure on health service etc.
(iii) When the proportion of children and the aged is larger, less income is saved and hence there would be less investment.
(iv) There will be low level of investment.
(v) Prices of goods will rise as a result of increase in demand.
(vi) The standard of living will fall as many people will be fed by the small number of working population.