If an Economy's Population Grows at 3 Percent and GDP

question 5

Multiple Choice

If an economy's population grows at 3 percent and GDP grows at 4 percent, then:

• A) per capita real GDP is declining.
• B) the economy's standard of living is decreasing.
• C) per capita real GDP is negative.
• D) per capita real GDP is growing.
• E) the economy is experiencing unemployment.

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Definitions:

Debt to Equity Ratio

A financial ratio that compares the total liabilities of a company to the total amount of shareholder equity.

Working Capital

The difference between a company's current assets and current liabilities, indicating the liquidity position of the business.

Long Term Liabilities

Obligations or debts that are due to be paid after one year or more, such as bonds payable or long-term loans.

Price-Earnings Ratio

A financial ratio that measures a company's current share price relative to its per-share earnings, used for valuing companies and comparing their financial health.