Suppose That Real GDP Increases by 5% While the Population

question 108

Multiple Choice

Suppose that real GDP increases by 5% while the population of a country increases by 7%. Then:

• A) Output per person necessarily increases
• B) Output per person necessarily decreases
• C) Output per person necessarily remains unchanged
• D) There is not enough information to determine what happens to output per person

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Definitions:

Standardized Products

Goods or services that are uniform in quality and performance, produced in large quantities, and often interchangeable.

Manufacturing Steps

Processes or stages involved in converting raw materials into finished goods.

Direct Labor

Direct labor refers to the wages or salaries paid to employees who are directly involved in the manufacturing or production of goods.

Overhead

The indirect costs or expenses incurred by a business that are not directly tied to specific product production or service.