Increases in the total real output of many DVCs do not increase the nation's standard of living because:
A. diminishing returns may be encountered in increasing total output.
B. population increases may dissipate the increase in real output.
C. disguised unemployment in agriculture will persist.
D. surplus farm labor may move from rural areas to industrial areas, causing unemployment.
B. population increases may dissipate the increase in real output.
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
Profits are part of the
A) factor services. B) monetary value of output. C) final consumer goods. D) total income.
An economy recovering from a recession
A) moves up from its trough to a period of expansion. B) moves up from its peak to a period of expansion. C) moves down from its trough to a period of depression. D) moves down from its peak to a period of expansion.
The price of a good always changes when
A) either a shortage or a surplus occurs. B) quantity demanded and quantity supplied are constant. C) there is an increase in demand and an increase in supply. D) there is a decrease in demand and a decrease in supply.