Rate of growth of an economy is measured in terms of________________?
Correct answer: D. National income
- A. Per capita income
- B. Industrial development
- C. Number of people who have been lifted above the poverty line
- D. National income
Explanation
The growth rate of an economy is conventionally measured by the percentage change in real national income over time. Per capita income is useful for measuring average living standards, not the overall growth rate itself.
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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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