Empirical Investigations into Whether Differences in Income Per Person Are

question 69

Multiple Choice

Empirical investigations into whether differences in income per person are the result of differences in the quantities of the factors of production available or differences in the efficiency with which the factors are employed typically find:

• A) a negative correlation between the quantity of factors and the efficiency of use.
• B) a positive correlation between the quantity of factors and the efficiency of use.
• C) no correlation between the quantity of factors and the efficiency of use.
• D) large gaps between the quantity of factors accumulated and the efficiency of use.

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Definitions:

GDP

Gross Domestic Product represents the complete market value of all final goods and services produced inside a nation's boundaries over a specific time frame.

Disposable Personal Income

The amount of money that households have available for spending and saving after income taxes have been accounted for.

Gross National Product

The total value of all goods and services produced by a country's residents and businesses, including those produced abroad, over a specific time period.

National Income

The total amount of money earned within a country, including wages, rent, interest, and profits.