Growth in GDP per capita will be achieved when
A)Labor demand decreases substantially while labor supply increases slightly.
B)GDP grows faster than the population.
C)Investment is equal to saving.
D)The government allows tax credits for companies who invest in research and development.

Question

Quizplus · Accepted Answer

GDP per capita is calculated by dividing total GDP by the population. Therefore, for there to be growth in GDP per capita, GDP must be growing faster than the population. Choices A and C do not necessarily lead to GDP per capita growth, while choice D may encourage investment and innovation but does not guarantee GDP per capita growth.

Growth in GDP Per Capita Will Be Achieved When