The main source of increases in material living standards over the long term is the
A)continual increase in potential national income.
B)continuous outward shift of aggregate demand.
C)positive slope of the aggregate supply curve.
D)maintenance of a continuous inflationary gap.
E)continual avoidance of recessionary gaps.

Question

Quizplus · Accepted Answer

The continual increase in potential national income through factors such as technological advancements, increases in productivity, and population growth is the main source of increases in material living standards over the long term. This allows for increases in wages, expansion of production, and a higher standard of living for individuals. The other options, such as continuous shifts in aggregate demand or inflationary gaps, may provide short-term boosts to material living standards, but they are not sustainable over the long term.

The Main Source of Increases in Material Living Standards Over