Figure 24-4
-Refer to Figure 24-4.In the figure above,LRAS1 and SRAS1 denote LRAS and SRAS in year 1,while LRAS2 and SRAS2 denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2?
A)8%
B)9.1%
C)10%
D)12%

Question

Figure 24-4 
-Refer to Figure 24-4.In the figure above,LRAS1 and SRAS1 denote LRAS and SRAS in year 1,while LRAS2 and SRAS2 denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2?
A)8% 
B)9.1% 
C)10% 
D)12%

Quizplus · Accepted Answer

The growth rate in potential GDP is calculated by comparing the shift from LRAS1 to LRAS2. If the figure indicates a 10% increase in the long-run aggregate supply, then the growth rate in potential GDP is 10%.

Figure 24-4 -Refer to Figure 24-4.In the Figure Above,LRAS1 and SRAS1 Denote