The economy's potential output is
a. the maximum output that could be achieved temporarily during a time of economic boom.
b. the minimum output that could be achieved during a recession.
c. present when 100 percent of the labor force is employed.
d. the maximum sustainable output of the economy given its resources.
D
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Bananas and apples are substitutes. When the price of bananas falls, and a technological advance in apple production occurs at the same time
A) the equilibrium price of apples rises and the equilibrium quantity of apples falls. B) the equilibrium price of apples rises and the equilibrium quantity of apples might rise or fall. C) the equilibrium price of apples rises and the equilibrium quantity of apples rises. D) the equilibrium price of apples falls and the equilibrium quantity of apples might rise or fall.
GDP measures:
A. expenditure on all final goods and services. B. total income of everyone in the economy. C. total value added by all firms in the economy. D. All of the answers are correct.