If full employment GDP is $8 trillion and equilibrium GDP is $7 trillion
A. there is definitely an inflationary gap.
B. there is probably an inflationary gap.
C. there is definitely a recessionary gap.
D. there is probably a recessionary gap.
C. there is definitely a recessionary gap.
You might also like to view...
Assume the equilibrium price level is 140 and the equilibrium real GDP is $15 trillion. What happens if the current price level equals 125?
What will be an ideal response?
The unemployment rate:
A. is measured by the number of people who are unemployed divided by the labor force. B. is never zero. C. measures what percentage of our labor force is currently looking for a job and can't find one. D. All of these are true.
When one country can produce a good more efficiently than another country:
A. that country should produce that good and be the sole "winner" of trade. B. that country can specialize in that good and choose only to export goods. C. both can specialize in the industry in which they have comparative advantage and experience mutual gains. D. that country has no basis for trading with another nation.
There would be some control over price within rather narrow limits in which market model?
A. Pure competition B. Monopolistic competition C. Oligopoly D. Pure monopoly