If Real GDP is less than Natural Real GDP, the economy is in
A) an inflationary gap.
B) a recessionary gap.
C) an unemployment gap.
D) a real gap.
B
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Trade agreements help to lower barriers to trade
a. True b. False
Headline inflation:
A. measures the changes in prices for the entire market basket of the average urban consumer. B. is inflation measured using the producer price index. C. measures price changes with food and energy costs taken out of the basket. D. is inflation measured using the retail price index.
Under monopolistic competition, there are:
A. significant barriers to entry. B. few barriers to entry. C. only a few buyers in the market. D. only a small number of sellers in the market.
When the economy is at its potential output:
A. there is no structural unemployment. B. there is no unemployment. C. there is no frictional unemployment. D. the labor force is fully employed.