Question

1. The following questions are about production and growth.

Country	Current Real GDP per capita	Current Growth Rate
A	$15,468	1.98%
B	$13,690	2.03%
C	$6,343	3.12%
D	$1,098	0.61%

1. Which country is the richest? How do you know?
   
   
   
2. Which country is advancing most quickly? How do you know?
   
   
   
3. If a country increases capital investment, what does it do to their growth rate?
   
   
   
4. Why do we use GDP per capita instead of GDP itself to determine standard of living in a country?
   
   
   
   
   
   
   
5. What are some shortcomings of using GDP and GDP per capita to measure the standard of living in a country?

Answer 1

Ans (A) Country A is the richest because it is having highest Current Real GDP per capita.

Ans (B) Country C is advancing more quickly because of the highest growth rate among other countries.

Ans (C) The growth rate increases as the capital investment increases. It drives the economic growth of a country.

Ans (D) Because GDP per capita reflects the GDP per person. It refers to the total gdp divided by total population.

And (E) The shortcomings of GDP or GDP per capita are as follows:

• It ignores welfare indicators such as health and education levels in a country.
• It ignores the illegal activity in a country.
• It ignores non-market transactions like a mother making food for their own family, etc.
• It ignores the income-inequality present in a country.