When a nation's real per capita Gross Domestic Product (GDP) increases, which of the following is true?
A) Every individual in that nation shares in the economic gain.
B) A nation must channel most of the economic gains to its poorest citizens.
C) Low income people are guaranteed to lose; they never share in their nation's economic gains.
D) We don't know who has most benefited from economic growth unless we look at the distribution of income.

Question

Quizplus · Accepted Answer

Real per capita GDP measures the average economic output per person in a country. When this measure increases, it indicates that the overall economy is growing, but it does not necessarily mean that every individual in that nation is benefiting equally. In fact, the distribution of income is a critical factor in determining who has benefited the most from economic growth. Therefore, we cannot make assumptions about how the gains are distributed among the population without looking at the distribution of income.

When a Nation's Real Per Capita Gross Domestic Product (GDP)