Economic growth is best measured by the increase in

Question

Quizplus · Accepted Answer

Economic growth is best measured by the increase in potential output, as this indicates an increase in the economy's ability to produce goods and services over time. Nominal GDP and disposable personal income can be influenced by inflation, while real disposable personal income adjusts for inflation but does not capture changes in productivity or technological advancements. Potential output, on the other hand, takes into account changes in productivity and technological progress, providing a more accurate measure of economic growth.

Economic Growth Is Best Measured by the Increase in