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In which situation can per capita GDP rise?

Answer and explanation

Correct answer: When GDP grows faster than population

Per capita GDP is calculated as total GDP divided by population: per capita GDP = GDP ÷ population. It rises when total GDP increases faster than the population, because output available on average for each person becomes greater. If population rises while GDP is constant, or GDP falls with a stable population, the ratio declines. Therefore, option A is correct.

Related tags

Per Capita GdpPopulation GrowthEconomic GrowthGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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