If real GDP in the United States is growing at an annual rate of 3.2% per capita and Bolivia's real GDP per capita
is growing at a rate of 1.3%, which of the following would we expect in the long run? Assume real GDP per capita in the United States begins at a level above that of real GDP per capita in Bolivia.
A) Real GDP per capita in the United States will always be 1.9% higher than real GDP per capita in Bolivia.
B) The difference between the level of real GDP per capita in the United States and real GDP per capita in Bolivia will increase over time.
C) The difference between the level of real GDP per capita in the United States and real GDP per capita in Bolivia will always be $1.9 trillion.
D) The difference between the level of real GDP per capita in the United States and real GDP per capita in Bolivia will shrink over time.
B
You might also like to view...
Explain the concept of diminishing returns
What will be an ideal response?
The price of a new car is $40,000 while the price of a five-year old car of the same brand is $16,000. The next year the price of the new car increases to $44,000 and the price of a five-year old car of the same brand is $17,600
The relative price of the used car A) decreased by $2,400. B) decreased by 10 percent. C) increased by 10 percent. D) remained constant at 0.4.
Two key differences in households today relative to those in the 19th century are that households today have:
a. increased production of goods and services and lower rates of female employment outside the home. b. increased reliance on markets for goods and services and lower rates of female employment outside the home. c. increased production of goods and services and higher rates of female employment outside the home. d. increased reliance on markets for goods and services and higher rates of female employment outside the home.
If a company believes the business sector is saturated with competitors, which of the following should it consider?
a. Product differentiation b. A buy-out or acquisition of some of the competition c. Create a price war with the competition d. Relocation of the business