Which of the following can be measured by the level of real GDP per person?

• A. The standard of living in a country
• B. The total government spending
• C. The unemployment rate
• D. The rate of inflation

Answer: (A)

Verified step by step guidance

1. Step 1: Understand what real GDP per person (also called real GDP per capita) represents. It is the total output of goods and services in an economy adjusted for inflation, divided by the population size.
2. Step 2: Recognize that real GDP per person is a measure of average economic output per individual, which is often used as an indicator of the average material well-being or economic prosperity of people in a country.
3. Step 3: Compare real GDP per person to the options given: total government spending, unemployment rate, and rate of inflation. Note that these are different economic indicators measuring different aspects of the economy.
4. Step 4: Identify that total government spending measures fiscal policy activity, unemployment rate measures labor market conditions, and rate of inflation measures changes in the price level, none of which directly reflect average income or economic welfare per person.
5. Step 5: Conclude that the level of real GDP per person is best associated with measuring the standard of living in a country, as it reflects the average economic resources available to individuals.