Which of the Following Can Explain Why Some Countries Have

question 191

Multiple Choice

Which of the following can explain why some countries have not experienced relatively high growth rates in real GDP per capita despite relatively low initial levels of real GDP per capita?

• A)Many of these developing countries do not have a functioning court system that can enforce laws.
• B)Countries that are relatively poor are more likely to experience wars and revolutions.
• C)Countries that are relatively poor are likely to have a lower quality of health care.
• D)all of the above

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Definitions:

Compound Increase

The growth of an amount where the increase over time accumulates on itself because the base amount changes due to additions made in previous periods.

Compounded Annually

The calculation and addition of interest to the principal once a year.

Nominal Rate

The interest rate before adjustment for inflation, not reflecting the real cost of borrowing or the real return on an investment.

Compounded Monthly

The routine of accruing interest monthly, which incorporates calculating interest on the initial principal as well as on the interest that has previously been accrued.