If the population of a country increase by 2 percent and the real GDP per capita increases by 1 percent, then we can conclude that the real GDP of the country must have:
A) decreased by 1 percent.
B) decreased by 3 percent.
C) increased by 1 percent.
D) increased by 3 percent.

Question

Quizplus · Accepted Answer

The real GDP per capita increases by 1 percent, which means the real GDP must have increased by more than the population growth rate of 2 percent. Therefore, the real GDP increased by 3 percent (2% population growth + 1% per capita growth).

If the Population of a Country Increase by 2 Percent