Which of the Following Does NOT Affect Potential GDP

question 164

Multiple Choice

Which of the following does NOT affect potential GDP?

• A)the quantity of money
• B)the quantity of labor employed
• C)the quantity of capital and human capital
• D)the amount of entrepreneurial talent available
• E)the quantity of land and natural resources

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Definitions:

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, characterized by a reduction in the per-unit cost as production increases.

Industrial Regulation

Laws and regulations that control how businesses can operate in certain industries to protect public safety, health, and the environment.

Economic Reason

Economic reason involves the rationale or logical basis behind economic decisions, focusing on the optimization of resource use to achieve specific monetary or utility outcomes.

Foreign Competition

The presence and influence of international companies in domestic markets, challenging local businesses.