The Maximum Quantity of Real GDP That Can Be Produced

question 113

Multiple Choice

The maximum quantity of real GDP that can be produced while avoiding shortages of labour, capital, land, and entrepreneurial ability that would bring rising inflation is

• A)potential GDP.
• B)real GDP.
• C)nominal GDP.
• D)productive GDP.
• E)actual GDP.

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Definitions:

Average Tax Rates

The ratio of the total amount of taxes paid to the total income, providing a measure of the tax burden.

Taxable Income

The portion of an individual’s or entity’s income that is subject to income tax after all deductions and exemptions.

Progressive

A system or policy where the level of contribution or effort increases with some measure of capacity, such as a progressive tax system where higher income earns pay a higher rate.

Proportional

Relating to or denoting a relationship where elements vary together at a constant rate and a change in one element results in a corresponding change in another.