Which of the Following Is True

question 140

Multiple Choice

Which of the following is true?

• A)Potential GDP is determined by the available supply of labor, capital, and technology only in the long run.
• B)Real GDP is determined by aggregate demand only in the short run.
• C)Potential GDP is equal to aggregate demand in the long run.
• D)Real GDP is determined by aggregate demand only in the long run.
• E)Potential and real GDP are always equal.

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Definitions:

Leverage

The use of borrowed capital or financial instruments to increase the potential return of an investment.

Restructuring

The process of reorganizing a company's structure, operations, or finances with the aim of improving efficiency and profitability.

Unlevered Cost

the cost of a project or investment without considering the financing aspect, such as interest expenses on debt.

Unlevered Cost

The cost of capital or investment that does not consider the effects of debt financing, reflecting the cost of equity alone.