Question

What is the most important factor that explains differences in living standards across countries?

Answer 1

The correct answer is letter "C": productivity.

Step-by-step explanation:

Productivity describes the output relationship compared to the inputs required to produce those outputs. It is an efficiency indicator. The total production of a country for a given period is calculated by computing its Gross Domestic Product (GDP).

When GDP is divided by the total population of a country, it is called GDP per capita, reflecting average individual expenditure. This metric makes it possible to have an idea of what those people's lifestyles are.

Answer 2

An increase in overall levels of prices in the economy

Step-by-step explanation:

Increment of the whole prices in goods, services and commodities will affect a nation and it will show which country is capable of withholding such standard of living.