Growth in potential GDP depends on
A. the labor force growth rate, capital stock growth rate, and rate of technical progress.
B. government spending, growth in prices, and labor productivity.
C. cyclical fluctuations and growth in the capital stock.
D. growth in real GDP, nominal GDP, and the population.
Answer: A
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Trade in services such as information technology
A) is like other trade, it creates winners and losers, but the gains for national economies likely outweigh the costs. B) creates gains for India's economy, but national welfare losses for the countries that import these services. C) make it highly likely that information technology jobs will ultimately disappear in the industrialized countries. D) is not perceived as threatening by industrialized countries so is unlikely to lead to any protectionist sentiment or pressures in the way the manufacturing does.
Suppose that, given the same number of workers, the United States can produce two times as many TVs or 20 times as many potatoes as Chile. Which of the following statements is true?
A. Chile should trade with the United States for potatoes because the United States has an absolute advantage in the production of potatoes. B. Chile should trade with the United States for TVs because the United States has an absolute advantage in the production of potatoes. C. The United States can benefit from trading TVs but not potatoes with Chile. D. The United States has absolute advantage in producing both goods.
Which of the following refers to human capital?
a. Money spent by business to acquire labor b. The acquired skill and productivity of workers c. The plant and equipment used with labor d. Money spent on purchasing the latest machinery e. Money that workers save
The difference between the nominal rate of interest and the real rate of interest is
A) handling charges. B) government regulatory charges. C) administrative overhead charges. D) the anticipated rate of inflation.