A factory in Techland could not sell 20 percent of its output during a certain year due to a decrease in the demand for its product.Which of the following would be true if it produced 20 percent less?
A) Techland's GDP for that year would have been higher.
B) Techland's GDP would have remained the same.
C) Techland's GDP for that year would have been lower.
D) Techland's income per capita for that year would have been higher.

Question

Quizplus · Accepted Answer

If the factory produced 20 percent less, the overall output of Techland would be lower, which would lead to a decrease in the country's GDP for that year. Therefore, Choice C is the correct answer. Choices A and B are incorrect because a decrease in production would not result in a higher or the same GDP. Choice D is also incorrect because income per capita would depend on many other factors besides the output of this one factory.

A Factory in Techland Could Not Sell 20 Percent of Its