a) Let’s assume the real GDP of country Z is increasing. James concludes that now the citizens of country Z can enjoy more goods and services. Why might his conclusion be wrong? Discuss in detail. b) The GDP of country A is higher than GDP of country B. Floyd concludes that the total income of the citizens of country A must be greater than country B. Why might his conclusion be wrong? When might his conclusion be correct?
a) Let’s assume the real GDP of country Z is increasing. James concludes that now the citizens of country Z can enjoy more goods and services. Why might his conclusion be wrong? Discuss in detail. b) The GDP of country A is higher than GDP of country B. Floyd concludes that the total income of the citizens of country A must be greater than country B. Why might his conclusion be wrong? When might his conclusion be correct?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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a) Let’s assume the real GDP of country Z is increasing. James concludes that now the citizens of
country Z can enjoy more goods and services. Why might his conclusion be wrong? Discuss in
detail.
b) The GDP of country A is higher than GDP of country B. Floyd concludes that the total income
of the citizens of country A must be greater than country B. Why might his conclusion be wrong?
When might his conclusion be correct?
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