Which of the Following Statements Best Describes the Relationship Between

question 75

Multiple Choice

Which of the following statements best describes the relationship between the initial wealth and the growth rate of a country?

• A)Countries with the highest growth rates over the past 100 years are the ones that had the highest level of real GDP 100 years ago.
• B)Countries that were rich a century ago had little fluctuation around their average growth rates during the past 100 years.
• C)Though the catch-up effect may suggest otherwise, the data show no strong relationship between initial conditions and growth rates.
• D)Over the past 100 years, Japan had the highest real GDP growth rate, and now it has the highest real GDP per person.

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Definitions:

Net Loss

The amount by which expenses exceed revenues.

Net Income

The amount of money remaining after all operating expenses, taxes, and dividends have been subtracted from total revenue.

Fair Value

An estimate of the price at which an asset or liability could be exchanged between knowledgeable, willing parties in an arm's length transaction.