GK
BUSINESS MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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population growth exceeds output
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capital formation increases
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imports exceeds exports
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output exceeds population growth
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Detailed explanation-1: -The statement is false. An increase in GDP only leads to an increase in real GDP per capita if the economic growth rate exceeds the population growth rate.
Detailed explanation-2: -Over the last few centuries: economic growth exceeded population growth. nominal GDP grew faster than inflation.
Detailed explanation-3: -If output growth exceeds population growth for a country, Average living standards will increase.
Detailed explanation-4: -Economic growth is a long-run process that occurs as an economy’s potential output increases. Changes in real GDP from quarter to quarter or even from year to year are short-run fluctuations that occur as aggregate demand and short-run aggregate supply change.
Detailed explanation-5: -A youthful population presents an opportunity for accelerated economic growth on a per capita basis, if countries where the population is growing rapidly achieve a substantial and sustained decline in the fertility level, leading to an increased concentration of the population in the working-age range.