Increases in real GNP per capita occur when ?
Correct answer: C. the rate of growth of real GNP is greater than the rate of growth of population
- A. government programs direct resources away from investment goods to consumer goods.
- B. tariffs and quotas prevent dollars from leaving the country
- C. the rate of growth of real GNP is greater than the rate of growth of population
- D. the level of consumption expenditures rises relative to the level of saving
Explanation
Real GNP per capita rises when total real GNP grows faster than the population, because output is increasing faster than the number of people sharing it. A rise in total GNP alone does not guarantee higher per-capita income.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
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.
Practise Macroeconomics
1,499 free Macroeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Macroeconomics questions
Two or more nuclear families of parent(s) and children is known as ?
Which of the following statement is true about low-income countries ?
According to Lewis's model the dual economy grows only when ?
The low-income economies generally have the following except ?
Industrialization?
What is gross domestic product (GDP) ?