Last Year Country a Had a Nominal GDP of R600

question 55

Multiple Choice

Last year country A had a nominal GDP of R600 billion, a GDP deflator of 150 and a population of 40 million.Country B had a nominal GDP of R720 billion, a GDP deflator of 120 and a population of 50 million.From these numbers which country is likely to have had the higher standard of living?

• A)Country A because it had the higher nominal GDP per person.
• B)Country B because it had the higher nominal GDP per person.
• C)Country A because it had the higher real GDP per person.
• D)Country B because it had the higher real GDP per person.

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Definitions:

Depreciation

The accounting method of allocating the cost of a tangible or physical asset over its useful life, reflecting the loss in value over time.

Business Use

The utilization of goods, services, or assets for the purpose of generating income or benefits in a business context.

Half-Year Convention

The Half-Year Convention is a method for calculating depreciation in which all assets acquired during a year are considered to have been acquired at the midpoint of the year.

Real Property

Land and anything permanently affixed to it, such as buildings, fences, and those things attached to the buildings.