Economic growth is best measured by increases in
A) nominal personal income.
B) nominal Gross Domestic Product (GDP).
C) per capita real Gross Domestic Product (GDP).
D) per capita nominal Gross Domestic Product (GDP).

Question

Quizplus · Accepted Answer

Per capita real Gross Domestic Product (GDP) is the best measure of economic growth because it takes into account population growth and inflation, giving a more accurate representation of changes in the standard of living for individuals in a country. Nominal GDP (option B) is less useful because it does not adjust for inflation, while nominal personal income (option A) only reflects the earnings of individuals rather than broader economic performance. Per capita nominal GDP (option D) is also less useful because it does not adjust for inflation.

Economic Growth Is Best Measured by Increases in