Changes in aggregate output in the medium run are determined primarily by:
A) fiscal policy.
B) monetary policy.
C) income and wages policy.
D) demand factors.
E) supply factors.

Question

Quizplus · Accepted Answer

Changes in aggregate output in the medium run are determined primarily by supply factors, such as changes in technology, investment, and productivity. While fiscal and monetary policies can have short-term effects on output, their impact is limited in the medium run. Demand factors, such as changes in consumer spending, also have a limited impact on medium-term output. Income and wages policy may affect the distribution of output among different groups, but do not determine the overall level of output.

Changes in Aggregate Output in the Medium Run Are Determined