Which of the Following May Increase Real GDP in the Short

question 7

Multiple Choice

Which of the following may increase real GDP in the short run but may actually decrease the long- run growth rate of GDP?

• A)increase in factor- utilization rates in the short run
• B)increase in the unemployment rate
• C)increase in factor supplies
• D)decrease in households' desired saving
• E)decrease in factor productivity

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Definitions:

Risk Aversion

A preference for avoiding losses over acquiring equivalent gains, indicating a behavior that leans towards avoiding risk.

Market Portfolio

A theoretical bundle of investments that includes every type of asset available in the market, with each asset weighted according to its total market capitalization.

Beta

A measure of a stock or portfolio's volatility in relation to the overall market, indicating its relative risk.

Firm Size

A measure of a company's scale or magnitude, often based on metrics such as revenue, assets, or number of employees.