You are socializing in a foreign country and the one you are talking to asks "How are people in your country?". How do you respond to such a naive question?
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I would ask them as a rational reply:
What is your mean?
And would try to help them explain what they want to know by this question. About my people's appearance or their everyday lives, social or economical situations then politely ask them to find what they have in their minds when they imagine my people to know if they have wrong or right information from TV or the other medias and their previous face to face or online experiences with my people. It will be important for me to consider me as a free traveler, a free human not a symbol of my nation and people who have a duty to follow or deny all stereotypes or propaganda about my nationality or country.
All above is about me but you is you and if you do not like these kinds of questions it is better to avoid of communication with local or ordinary people who may not have enough knowledge or language skills to communicate with you or you are the first one from your country they have seen in all their own lives and are excited about you! :)