Which of the following is true about low-income countries?
A) They face high levels of potential output, largely because of the size of their population.
B) They tend to have low levels of potential output and are producing well below their potential.
C) They face high levels of potential output, but tend to produce well below their potential because of high illiteracy rates.
D) They face high levels of potential output, but tend to produce well below their potential because of political instability.

Question

Quizplus · Accepted Answer

Low-income countries typically have limited resources and underdeveloped technology, which results in low levels of potential output. Additionally, they often struggle with poor infrastructure, limited access to education and healthcare, and political instability, which further hinder their ability to reach their potential. Therefore, low-income countries tend to produce well below their potential.

Which of the Following Is True About Low-Income Countries