Question

g Which government policy would be more effective at increasing output per capita (if such a policy was available): a policy which doubles the savings rate. a policy which doubles the productivity of capital. a policy which doubles population growth. all three policies would have equal effectiveness.

Answer 1

ANSWER: The correct answer is "A POLICY WHICH DOUBLES THE PRODUCTIVITY OF CAPITAL".

EXPLANATION: Output per capital is a measure to determine a countries economic rate. It is also known as the country's GDP. It is calculated by dividing the country's gross domestic product by its total population.

This means that if a country has to increase it's output per capital, it has to increase it's domestic production. Such country has to reduce the government policies on industries and giving out loans and Grant to industries, in order to encourage investors and increase the production capacity of he country.

If a country's population growth increases without an increase in their productions output, such country will suffer depression in their GDP which will increase poverty among the citizens of that country.