Q. Consider the following statements regarding underdeveloped economies:

1. They typically exhibit low per capita income
2. They are characterized by a low rate of capital formation
3. The majority of the working force is engaged in the tertiary sector

Which of the above statements is/are correct?
Answer: Only 1 and 2
Notes: Underdeveloped economies are generally marked by low per capita income and low capital formation due to limited savings and investments. However, in such economies, the majority of the workforce is usually engaged in the primary sector, not the tertiary sector, which dominates more developed economies. Therefore, only statements 1 and 2 are correct.