Suppose two countries, country a and country b, have a similar real gdp per capita. country a has an average economic growth rate of 2% and country b has an average economic growth rate of 3.3%. in the long run, what can we predict about living standards in the two countries?

Question

Ray Black

Social Studies

13 August, 07:56

Suppose two countries, country a and country b, have a similar real gdp per capita. country a has an average economic growth rate of 2% and country b has an average economic growth rate of 3.3%. in the long run, what can we predict about living standards in the two countries?

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Answers (1)

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Buchanan · Answer 1

In the long run, we can predict that the living standard in country B will be higher than the country A.

Higher economic growth rate will lead to more potential for investment, which will lead to many job opportunities.

Many job opportunities will lead to more income that could be spent, which will eventually lead to higher living standard.