Sustainable long-run economic growth is growth that can continue in the face of which of the following?

• A. Unemployment
• B. Inflation
• C. Decreasing global population growth
• D. a limited supply of natural resources and the negative effects of past economic growth

Answer: (D)

Sustainable long-run growth is the kind of growth that can keep continuing even when the economy faces limits on its inputs and the costs that past growth has imposed. The crucial challenge is finite natural resources and the environmental and other negative effects that growth can create. If resources become scarcer or pollution and ecosystem damage reduce productive capacity, the economy’s potential to grow can stall or slow dramatically. Unemployment and inflation describe other conditions in the economy but do not directly capture the constraint that would prevent growth from being sustained over time. Slower population growth changes the pace of growth but isn’t the fundamental barrier to sustainability in the same way resource limits and the negative consequences of growth are. So the best answer highlights the limits of natural resources and the harmful side effects of past growth as the factors that sustainable growth must withstand.