For comparing changes in average material living standards over time, the most suitable measure is
Correct answer: B. Real GDP per capita
- A. Nominal GDP per capita
- B. Real GDP per capita
- C. Total money supply
- D. The consumer price index
Explanation
Real GDP per capita adjusts output for price changes and population size, making it more useful for comparing average production across time. Nominal GDP per capita can rise solely because prices increase.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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