What can an increase in GDP indicate about a country's economy?

An increase in GDP typically indicates improvements in overall productivity and living standards. GDP, or Gross Domestic Product, measures the total value of all goods and services produced in a country over a specific period. When GDP rises, it generally reflects that businesses are producing more, which can lead to greater employment opportunities and income for workers.

As productivity increases, the economy can produce more goods and services efficiently, which often results in higher wages and better job opportunities for individuals. Consequently, this can lead to enhancements in the standard of living, as people have more income to spend on healthcare, education, and other essential services, contributing to overall societal well-being.

An increase in GDP doesn't inherently suggest a decrease in standard of living, a decline job creation, or an increased reliance on external borrowing; on the contrary, it typically points to economic growth and potential improvement in living conditions. Hence, the correct answer highlights the positive implications of GDP growth in relation to productivity and living standards.