Potential GDP Is

question 108

Multiple Choice

Potential GDP is

• A)equal to the maximum amount of goods and services that can be produced at any given time.
• B)another name for real GDP.
• C)the level of output produced when the economy is fully employed.
• D)a measure of the short term fluctuations in real GDP.
• E)another name for nominal GDP.

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Definitions:

Variable Costs

Costs that vary directly with the level of production or sales volume such as materials and labor.

Type Of Cost

Classification of cost based on nature, function, or behavior in relation to the production or delivery of goods and services.

Type Of Cost

A category within accounting that relates to the nature of expenses incurred, such as fixed, variable, direct, or indirect costs.

Plant Expansion

The process or activity of increasing the capacity or size of a manufacturing facility.