The long-run output of an economy depends on
A) the level of spending.
B) the level of unemployment.
C) the level of inflation.
D) the level of aggregate demand.
E) resources,technology,and institutions.

Question

Quizplus · Accepted Answer

Long-run output is determined by the level of resources (natural, human, and physical), the technology available to use those resources efficiently, and the institutions (such as laws, property rights, and regulations) that support economic activity. While spending, unemployment, inflation, and aggregate demand can all affect short-term fluctuations in output, in the long run, the economy's productive capacity is primarily determined by these underlying factors.

The Long-Run Output of an Economy Depends on