The comparison of the standard of living between Nigeria and Ghana is best down through the use of

Step 1: Analyze the question We are asked which measure is best for comparing the standard of living between two countries, Nigeria and Ghana, which differ in population size and total output.

Step 2: Explain the concept Standard of living refers to the average level of material well-being of people in a country. To compare it fairly across countries, we need a measure that accounts for population size.

• GDP, GNI and Net National Income are total figures. Nigeria has a much bigger population than Ghana, so its totals will usually look larger even if the average person is not better off.
• Net disposable income measures income available for spending after taxes. It is useful for households but is not the standard cross-country comparison.
• Per capita income = National Income ÷ Population. It gives the average income per person, so it removes the distortion caused by differing population sizes.

Step 3: Solution Per capita income = Total national income / Total population

Because it shows the average income per head, it is the best indicator for comparing living standards between countries of different sizes.

Step 4: Answer The correct option is E. per capita income.

Tip: When you see "standard of living" together with "comparison between countries," think "per capita", meaning "per head." Totals show the size of an economy, while per capita figures show how well off the average person is.