Q: What is economic growth?
A: An increase in a country’s output (usually real GDP) over time.
Q: What is economic development?
A: A long-term improvement in living standards
Q: What is the difference between nominal and real GDP?
A: Nominal GDP is measured at current prices; real GDP is adjusted for inflation.
Q: Why is real GDP per capita important?
A: It shows average income per person and is a better measure of living standards.
Q: What is the Rule of 70?
A: A formula to estimate doubling time: 70 ÷ growth rate (%) = years to double GDP.
Q: What does the convergence theory say?
A: Poorer countries tend to grow faster than rich ones and "catch up", if conditions are similar.
Q: Why doesn’t convergence always happen?
A: Because some countries lack technology, institutions, or stability needed for growth.
Q: What can cause nominal GDP to increase without real growth?
A: Inflation (price increases).
Q: Why is GDP per capita better than total GDP?
A: Because it accounts for population size and reflects individual prosperity.
Last changed13 days ago