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- Long Term Economic Growtheconomics-mcqs › long-term-economic-growth
- Published
- 1 Jun 2019
- Last updated
- 28 May 2026
What constraint does the fact that gross investment cannot be negative place on variations in which economic measure?
Multiple choice question for Long Term Economic Growth. Select an option, then review the explanation below.
Explanation
Since gross investment cannot fall below zero, it sets a lower bound on fluctuations in output, preventing it from dropping indefinitely.
More Long Term Economic Growth MCQs
Practice related questions from the same subject.
- 1.According to real business cycle theory, what is the suggested approach to address deviations from the optimal growth trajectory?
- 2.According to the multiplier-accelerator model, what is investment dependent on?
- 3.Which of the following is NOT considered a phase of the business cycle?
- 4.What does the business cycle represent in terms of output variation?
- 5.According to the neoclassical growth theory, the steady-state growth rate is defined as the level of ____ necessary to maintain ____ constant as the labor force expands?