The level of GDP associated with the long run is called _____.
A) actual GDP
B) potential GDP
C) surplus GDP
D) deﬁcit GDP

Question

Quizplus · Accepted Answer

Potential GDP refers to the level of output that an economy can produce at a constant inflation rate when it is utilizing all of its resources efficiently. It represents the maximum sustainable level of output that an economy can achieve in the long run without increasing inflation.

The Level of GDP Associated with the Long Run Is