Trenton McCarthy chapter 9 question 6

GDP is a very complex concept that has multiple different aspects to grasp in order to understand it fully. Wheelen does a good job of laying it all out in simpler terms. I found a couple things very interesting when reading. 1) even if GDP rises, that does not mean the economy is growing in a healthy way. We must take into account inflation. If GDP increases by 10% and inflation also increases by 10%, then we are stagnant in terms of economic growth. People may be making more money, by the prices of goods is also rising. With that being said, you're not any richer than before and this situation is equivalent to exchanging a ten dollar bill with ten one dollar bills. 2) India is an example of what it means for a country to be poor by global standards. India may have a high GDP, but they also have 1 billion people. In the case of leprosy, the cure for a mild case is $3 and a cure for a more secure case is $20. But in India, quality medical services are not provided and doctors and nurses are not able to identify all afflicted. In the end, 100,000 people are horribly disfigured by the disease even though the cure only costs $3-$20, which is relatively cheap. That's what it means to have a per capita GDP of $2,900 that is India.