Which of the Following Statements About Potential GDP Is True

Multiple Choice

Which of the following statements about potential GDP is true?

A) Potential GDP is not equal to the maximum level of real GDP.
B) Potential GDP is equal to the downward trend in real GDP.
C) Potential GDP represents the GDP a country will experience when the real interest rate is equal to zero.
D) Potential GDP represents the long-run tendency of the economy to grow.
E) Potential GDP is equal to the average level of real GDP.