Which statement is correct about the Human Development Index (HDI) and real GDP?
HDI includes exports and imports while real GDP does not.
HDI includes life expectancy and years of schooling while real GDP does not.
HDI includes the level of output while real GDP does not.
HDI includes the level of unemployment in the population while real GDP does not.
The Human Development Index can be used to measure human development in countries. Which measure would not be part of its calculation?
inequality of incomes
life expectancy
income per head
years of schooling
What is the key advantage of using real GDP per capita over nominal GDP per capita?
It accounts for population size
It is adjusted for inflation, allowing comparison over time
It includes the value of unpaid domestic work
It measures the total output of a country more accurately
Which combination of changes is most likely to result in a fall in living standards in a country?
A
B
C
D
Real GDP per head may not reflect the true products available to people because it:
includes an accurate measure of the underground economy
excludes the value of unpaid work, such as childcare at home
uses market prices to value goods and services
is measured in real terms to account for inflation
If a country's economic growth is driven by industries that cause significant environmental damage, real GDP per head will likely:
decrease because of the costs of pollution
fail to account for the negative impact on the quality of life
accurately show the decline in sustainable living standards
increase only if the government taxes the polluting industries
Which of the following is a limitation of using GDP per head to measure living standards?
It ignores income distribution
It is difficult to calculate
It includes non-monetary output
It measures only non-market activities
Which of the following would increase the standard of living in a country?
An increase in unemployment
An improvement in healthcare
A rise in inflation
A fall in literacy
A fall in GDP per head always means:
The standard of living has fallen
The population has increased
Output per person has decreased
Inflation has risen
GDP per head is a poor indicator of living standards because:
It includes unpaid work and leisure
It ignores externalities and quality of life
It excludes goods and services
It measures productivity only
Comparing living standards between countries is difficult because:
Prices and costs of living differ between countries
GDP per head is the same everywhere
Exchange rates are fixed
Data is never available
What is meant by absolute poverty?
Earning below the average income of a country
Being unable to afford basic needs such as food and shelter
Living on less than half of national income
Having no access to luxury goods
Relative poverty occurs when:
People’s income is below a fixed dollar amount
People’s income is below the average income of society
People have no access to healthcare
Inflation is high
Which of the following best describes the main difference between absolute and relative poverty?
Relative poverty is temporary; absolute poverty is permanent
Absolute poverty is measured by income; relative poverty by spending
Absolute poverty is based on survival needs, while relative poverty compares living standards
There is no difference
Which of the following is a common cause of absolute poverty?
High level of education
Unemployment and low income
Economic growth
Access to healthcare
Which of the following is a cause of poverty in developing countries?
High productivity
Lack of education and training
Low birth rate
Abundant natural resources
Which of the following would help reduce poverty in a country?
Increasing indirect taxes
Providing free education and healthcare
Reducing welfare benefits
Cutting government spending on public services
Which policy is most likely to reduce relative poverty?
Lowering the minimum wage
Introducing progressive taxation
Increasing prices of basic goods
Reducing education spending
Why does rapid population growth increase poverty levels?
It increases per capita income
It puts pressure on resources and jobs
It increases government tax revenue
It encourages savings
A fall in relative poverty may occur if:
The rich become richer faster than the poor
Incomes of the poor rise faster than those of the rich
The government cuts welfare
Inflation increases