Economic growth is defined as:
A)an increase in either real GDP or real GDP per capita.
B)an increase in the nominal GDP.
C)an increase in the overall general price level.
D)an increase in the level of consumption.

Question

Quizplus · Accepted Answer

Economic growth refers to an increase in either real GDP or real GDP per capita. Real GDP is adjusted for inflation and therefore provides a better measure of changes in economic output over time. Real GDP per capita measures the output per person and accounts for changes in population, making it a useful indicator of standard of living. An increase in nominal GDP (B) does not necessarily reflect economic growth as it may be due to inflation or population growth. An increase in overall general price level (C) indicates inflation, which can actually reduce economic growth. An increase in the level of consumption (D) does not necessarily reflect economic growth as it could be financed through borrowing and may not be sustainable in the long run.

Economic Growth Is Defined As