The growth rate of potential GDP is the sum of the growth rates of
a. labor force and population.
b. labor force and labor productivity.
c. labor force and capital stock.
d. labor productivity and capital stock.
b
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In a self-regulating economy, inflationary and recessionary gaps produce shifts of the
A) AD curve that maintain the short-run equilibrium point. B) AD curve that move the economy to a long-run equilibrium point. C) SRAS curve that maintain the short-run equilibrium point. D) SRAS curve that move the economy to a long-run equilibrium point.
Individual accountability within the government bureaucracy:
A. tends to be greater than in private firms, making government more efficient than private firms. B. is not a problem because government bureaucrats are not affected by the self-interest that affects private sector individuals. C. is easy to monitor because of the small size and scope of government. D. tends to be lacking because of civil service protections and the complexity of government.