Assume That the Real Output of a Developing Nation Increases

question 59

Multiple Choice

Assume that the real output of a developing nation increases from $50 billion to $62 billion, while its population expands from 100 to 115 million. As a result, real income per capita has increased by about

• A)$39 per person.
• B)$64 per person.
• C)$12 per person.
• D)$27 per person.

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Definitions:

Marginal Benefits

The added pleasure or value that comes from the additional consumption or production of a good or service unit.

Marginal Costs

The supplementary cost involved in the production of one more unit of a product or service.

Production Possibilities Curve

A graph that shows the maximum number of possible units of two commodities that a economy can produce with available resources and technology.

Marginal Benefit

The incremental gain in happiness or usefulness obtained through consuming an extra unit of a good or service.