1)Consider a nation in which the volume of goods and services is growing by 5 percent per year. a. If a country’s economic size is growing faster than the rest of the world, then the share of the world’s goods and services that are produced in this country will fall.other countries will also have similar rates of growth.this country will gain influence in the international sector.the balance of trade will worsen. b. If a country’s living standards are increasing at 5 percent, this implies that prices are decreasing at a rate of 5 percent below the population growth.output is increasing at a rate of 5 percent above the population growth.output is increasing at a rate of 5 percent below the population growth.prices are increasing at a rate of 5 percent above the population growth.

An increase in the nation's volume of goods and services is termed as economic growth. Gross…

Answered: Consider a nation in which the volume…

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter32: Macroeconomic Policy Around The World

Section: Chapter Questions

Problem 29CTQ: Explain why converging economies may present a strong argument for limiting flows of capital but not...

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1)Consider a nation in which the volume of goods and services is growing by 5 percent per year.

a. If a country’s economic size is growing faster than the rest of the world, then

the share of the world’s goods and services that are produced in this country will fall.
other countries will also have similar rates of growth.
this country will gain influence in the international sector.
the balance of trade will worsen.

b. If a country’s living standards are increasing at 5 percent, this implies that

prices are decreasing at a rate of 5 percent below the population growth.
output is increasing at a rate of 5 percent above the population growth.
output is increasing at a rate of 5 percent below the population growth.
prices are increasing at a rate of 5 percent above the population growth.

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

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