Libeteria has a population of 10,000,of whom 7,000 work 8 hours a day to produce a total of 224,000 final goods.Despotvanyla has a population of 5,000,of whom 4,000 work 12 hours a day to produce a total of 120,000 final goods.

Question

Quizplus · Accepted Answer

To calculate productivity, we divide the total output by the number of workers and the number of working hours.

For Libeteria: 
Productivity = (224,000/7000)/(8)= 4 
Real GDP per person = 224,000/10,000 = 22.4

For Despotvanyla: 
Productivity = (120,000/4000)/(12)= 2.5 
Real GDP per person = 120,000/5000 = 24

As we can see, Libeteria has higher productivity (4 compared to 2.5) but lower real GDP per person (22.4 compared to 24) than Despotvanyla. Therefore, the correct answer is A.

Libeteria Has a Population of 10,000,of Whom 7,000 Work 8