Over a long period of time, perhaps many years, changes in real GDP come primarily from

Question

Quizplus · Accepted Answer

Potential GDP represents the maximum level of real GDP that can be attained given the available factors of production and the technology for producing goods and services. Over a long period of time, continuous increases in potential GDP result in increases in real GDP. This is because, as the economy grows, there are more factors of production, such as labor and capital, which can be utilized to produce more goods and services. As potential GDP increases, the economy can produce more output, leading to increases in real GDP. Therefore, option A is the best choice.

Over a Long Period of Time, Perhaps Many Years, Changes