According to the Convergence Hypothesis, the Poorest Countries Have the Fastest

question 1

True/False

According to the convergence hypothesis, the poorest countries have the fastest growth rate of real GDP per capita.

---

Definitions:

Recessionary Gap

The difference between the actual output of an economy and its potential output if all resources were employed at their maximum efficiency during a recession.

Equilibrium GDP

The level of gross domestic product at which aggregate supply equals aggregate demand, indicating a balance in the economy without any external pressures to change.

Full Employment GDP

The maximum level of output (GDP) an economy can achieve when utilizing all its resources fully and efficiently, without triggering inflation.

Fiscal Policy

Government policies related to taxation and spending to influence the economy.