How does the rate of population growth influence the level of GDP per person? a.

Question

How does the rate of population growth influence the level of GDP per person?

a. It increases the capital stock per worker which raises output per worker and it may increase technological progress which raises output per worker.

b. It decreases the capital stock per worker which reduces output per worker but it may increase technological progress which raises output per worker.

c. It decreases the capital stock per worker which reduces output per worker and it decreases technological progress which reduces output per worker.

d. It increases the capital stock per worker which raises output per worker but it decreases technological progress which reduces output per worker.

Explanation / Answer

The correct answer is option (A). The rate of population growth influence the level of GDP per person. It increases the capital stock per worker which raises output per worker and it may increase technological progress which raises output per worker.

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