Economic growth is best defined as
A) rightward shifts of the AD curve.
B) increases in potential GDP.
C) decreases in potential GDP.
D) rightward shifts of the SAS curve.

Question

Quizplus · Accepted Answer

Economic growth refers to an increase in the production of goods and services in an economy over time, which is represented by an increase in potential GDP. This is achieved through the expansion of the economy’s factors of production, such as labor, capital, and technology. Rightward shifts of the AD and SAS curves can lead to short-term expansions in economic activity, but they do not necessarily represent sustained economic growth.

Economic Growth Is Best Defined as