Dividing real GDP by the population:

Question

Quizplus · Accepted Answer

Dividing real GDP by the population gives us a measure of real output per person in the economy (i.e. real GDP per capita), which is a useful indicator of economic development and standard of living. Option A is incorrect because consumption per capita would require dividing total consumption by the population, not GDP. Option B is incorrect because nominal GDP per person would require using the current market prices instead of adjusting for inflation. Option D is incorrect because dividing GDP by the population does not measure happiness or subjective well-being.

Dividing Real GDP by the Population