In the classical model, real Gross Domestic Product (GDP) per year is
A) due to supply conditions plus the extent of government intervention in the economy.
B) determined by supply and demand conditions together.
C) supply determined.
D) demand determined.

Question

Quizplus · Accepted Answer

According to the classical model, real GDP is supply determined, meaning that the quantity of goods and services produced and available for purchase determines overall output. Demands for goods and services by households, businesses, and governments are believed to be less important in determining real GDP in the classical model.

In the Classical Model, Real Gross Domestic Product (GDP) Per