A nation’s standard of living is determined by a. the percentage of its GDP that

Question

A nation’s standard of living is determined by
a. the percentage of its GDP that is accounted for by government purchases. b. the quantity of natural resources with which it is endowed. c. the productivity of its workers. d. factors and events that are beyond the nation’s control. A nation’s standard of living is determined by
a. the percentage of its GDP that is accounted for by government purchases. b. the quantity of natural resources with which it is endowed. c. the productivity of its workers. d. factors and events that are beyond the nation’s control.
a. the percentage of its GDP that is accounted for by government purchases. b. the quantity of natural resources with which it is endowed. c. the productivity of its workers. d. factors and events that are beyond the nation’s control. a. the percentage of its GDP that is accounted for by government purchases. b. the quantity of natural resources with which it is endowed. c. the productivity of its workers. d. factors and events that are beyond the nation’s control.

Explanation / Answer

Correct Answer:
C

The productivity level helps to determine the value of marginal product that is linked to the wages, given to the workers. Hence, higher productivity and subsequent higher wages, will create higher disposable income and standard of living will improve.

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