Understanding GDP and Economic Growth

Very Easy Economic Analysis Macro Analysis

As part of your ongoing economic analysis for a wealth management advisory, you are assessing indicators that reflect the overall health of an economy. One of the key indicators is the Gross Domestic Product (GDP). This measure reflects the total economic output of a country. Understanding its fluctuations can help in predicting economic trends and making informed investment decisions.

Which of the following statements accurately describes the relationship between GDP and economic growth?

GDP measures the total income earned by a nation's residents in a year.

An increase in GDP typically indicates economic expansion.

GDP is the sole determinant of a country's economic health.

Hint

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