Chapter 37, Problem 2MCQ

To determine

To know: Key static used to track economic growth.

Answer to Problem 2MCQ

The correct option is C.

Explanation of Solution

Option C - Real GDP per capita is correct.

Real GDP per capita is the key static to track economic growth. Economic growth is measured by GDP of a nation. When it is real GDP, it implies it is inflation-adjusted growth factor. So, it is the true indication of economic growth of the country. Moreover, when it gets divided by population growth, it shows dissemination of economic growth to population.

A

GDP is not a correct option as a key statistic to track economic growth.

B

Real GDP is not a correct option as it would not show how the economic growth spreads to the population.

D

Median real GDP shows economic growth limited to 50% of the population of a nation, which is an incorrect indicator for the economic growth.

E

Median real GDP per capita shows economic growth but limited to half of the population. It is a biased indicator.

Economics Concept Introduction

Introduction:

Economic growth is the increase in level of aggregate production of an economy which is manifested in national income. It shows the growth of production of goods and services over a year.