We often use real GDP per capita as a measure of a country\'s well-being. Review

Question

We often use real GDP per capita as a measure of a country's well-being. Review the definition of real GDP per capita before answering the following question. Today, the typical American works fewer than 40 hours per week In 1890, the typical American worked 60 hours per week Would the difference between the real GDP per capita in 1890 and the real GDP per capita today understate or overstate the difference in the population's economic well-being? The increase in real GDP per capita between 1890 and today understates well being because the value of leisure is not included in GDP. The decrease in real GDP per capita between 1890 and today understates well-being because the value of leisure is not included in GDP The increase in real GDP per capita between 1890 and today overstates well-being because the value of leisure is not included in GDP The decrease in real GDP per capita between 1890 and today overstates w ell being because the value of leisure is not included in GDP.

Explanation / Answer

OPTION A IS CORRECT.

The increase in real GDP per capita between 1890 and today understates well-being because the value of leisure is not included in GDP.

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