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What do you mean by standard of living?
Standard of living (SoL):
It is incomer per capita (head) and it is determined by national income (GDP) divided through total population:
• It is significant to use real GDP to make sure NY is adjusted for inflation
• Cet par an increase within real GDP that is economic growth raises SoL
• NB: SoL is an average and provides no indication of the distribution of income. What when only the ruling elite enjoy the advantages of growth due to a highly unequal distribution of income.
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Importance of production.
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