Question

What is the effect on the standard of living (Y/L) of increased research and development (R&D)?  Up, Down, or Same?

Answer 1

Up

Standard of living at is also called GDP per capita

GDP per capita is the GDP divided by total population of the economy

For any country whether it is developing or developed resources and development play a very crucial role

It is the the activity that includes the innovation of new product and services which is helpful for the mankind

So whenever there is increase in the research and development, it will always boost up the GDP per capita as well

GDP main components are expenditure, consumption, government spending and net export

If there is a good research and development then it will boost more production and ultimately lead to more export

It will also help in boosting the consumption