Which Statement Best Explains Economists' Understanding of the Facts Concerning

question 155

Multiple Choice

Which statement best explains economists' understanding of the facts concerning the relationship between natural resources and economic growth?

• A) A country with few or no domestic natural resources is destined to remain undeveloped.
• B) Differences in natural resources have virtually no role in explaining differences in standards of living.
• C) Some countries can be rich mostly because of their natural resources, and countries without natural resources need not be poor, but can never have very high standards of living.
• D) Abundant domestic natural resources may help make a country rich, but even countries with few natural resources can have high standards of living.

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Definitions:

Minimize Cost

A strategy or objective aimed at reducing expenses to the lowest possible level while achieving the desired outcome.

Expected Price Level

Expected price level refers to the anticipated average cost of goods and services in the future, based on current trends and economic indicators.

Recessionary Gap

A condition in macroeconomics when an economy's real GDP is lower than its potential GDP, leading to unemployment and underutilized resources.

Increase Production

A situation where a company or country grows its capability to produce goods or services, often in response to higher demand or improved efficiency.