A One Percentage Point in the Growth Rate

question 30

Multiple Choice

A one percentage point in the growth rate

• A) does not make much difference in the long run per capita real GDP.
• B) will not influence the real standard of living in a country.
• C) can make a big difference in the per capita real GDP because of urban congestion.
• D) can make a big difference in the per capita real GDP because of compounding.

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Definitions:

Panama Canal

A man-made waterway in Panama that connects the Atlantic Ocean with the Pacific Ocean, significantly reducing the maritime journey time by avoiding the lengthy southern tip of South America.

Treaties

Formal agreements between countries that define and modify their mutual duties and obligations.

Panama

A country in Central America, located at the junction of North and South America, known for the Panama Canal which connects the Atlantic and Pacific Oceans.

Stagflation

An economic condition characterized by slow economic growth and high unemployment coupled with high inflation.