A recessionary gap refers to the gap between real GDP and potential GDP when the level of output is above the level of potential GDP
a. True
b. False
Indicate whether the statement is true or false
False
You might also like to view...
Refer to Figure 5-13. The market equilibrium price of gasoline is ________ per gallon
A) $3.00 B) $3.75 C) $4.25 D) $5.00
Medicare is an example of a third-party payment for medical services that
A) causes providers to supply less of medical services than they would without the payment. B) causes buyers to consume more of medical services than they would without the payment. C) does not cause any change in the equilibrium position for medical services which existed without the subsidy. D) causes the price of medical services to rise for the consumer once the payment is provided.
Make a case for income inequality
According to the simple macroeconomic model presented in Chapter 3, which of the following will not be caused by an increase in government spending?
A. an increase in interest rate B. a decrease in consumption C. a decrease in investment D. an increase in government debt