Why Does South Korea Have a Higher Level of Real

question 86

Multiple Choice

Why does South Korea have a higher level of real GDP per capita than North Korea?

• A) South Korea started with more human capital than North Korea.
• B) South Korea started with more physical capital than North Korea.
• C) South Korea has a better system of incentives than North Korea.
• D) South Korea has more natural resources than North Korea.

---

Definitions:

Wage Rate

The amount of money paid to an employee by an employer in exchange for work performed, typically expressed on an hourly, daily, or piecework basis.

Workers Hired

The process of employing individuals to perform tasks or services in exchange for compensation.

Demand for Steel

The total quantity of steel that buyers in the market are willing and able to purchase at various prices over a given period.

Demand for Capital

The desire for acquiring new machinery, buildings, and other investments to expand business operations or efficiency.