Potential GDP Is

question 54

Multiple Choice

Potential GDP is

• A)always different from real GDP.
• B)another name for real GDP.
• C)the level of GDP not adjusted for price changes.
• D)the maximum amount of GDP that can be produced while avoiding shortages of labour, capital, land and entrepreneurship that would bring rising inflation.

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Definitions:

Risk Averse

A characteristic of a person or entity that prefers to avoid uncertainty and potentially negative outcomes, often opting for more certain or less risky options.

Risk Averse

Refers to the preference of avoiding risk rather than facing uncertainty or engaging in risky ventures.

Price of Insurance

The cost or premium that individuals or entities pay to transfer risk to an insurance company, securing financial protection against specified losses.

Wealth

The total value of all financial and material possessions owned by an individual, entity, or country.