Output in the long run is determined by which of the two following factors when an economy operates at full employment?
A) capital and supply
B) imports and exports
C) capital and labor
D) the "real" GDP and purchases

Question

Quizplus · Accepted Answer

When an economy operates at full employment, output in the long run is determined by the factors of production - capital and labor. The amount of capital and labor available to an economy will determine its potential output in the long run. The other options, such as imports and exports, real GDP, and purchases, may affect the economy in different ways but they do not determine output in the long run when an economy is at full employment.

Output in the Long Run Is Determined by Which of the Two