How does technological progress affect real GDP?

Economics Real Vs Nominal Gdp Questions



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How does technological progress affect real GDP?

Technological progress positively affects real GDP by increasing productivity and efficiency in the production process. It allows for the creation of new and improved goods and services, leading to higher output levels. Technological advancements also enable cost reductions, which can lead to lower prices for consumers and increased purchasing power. Overall, technological progress contributes to economic growth and an increase in real GDP.