Question

Economists who believe that the 1995-2012 rise in the average rate of productivity growth will be long lasting say that:

A. Innovations in computers and communications, together with global capitalism, are greatly boosting US productivity and the economy's potential economic growth rate.

B. technological advance creates its own supply, which n turn creates its own demand.

C. The US is entering an era of high structural unemployment due to rapid technological change

D. Technological change will require more central planning and government regulation

Answer 1

Option B is correct

Technological advance creates its own supply, which n turn creates its own demand.

Because:-

In economics output is the quantity of goods and services produced in a given time period. The level of output is determined by both the aggregate supply and aggregate demand with in an economy.National output is what makes a country rich not large amount of money. For this reason understanding the the fluctuations in economic output is critical for long term growth.

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