If potential output for an economy equals $8 billion and actual output equals $7 billion, then this economy's output gap should be expressed as:
A. $1 billion.
B. ?12.5 percent.
C. 12.5 percent.
D. ?$1 billion.
Answer: B
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Indicate whether the statement is true or false
Econville opens up trade with its neighboring countries. This causes the number of sellers of science fiction novels to increase. What happens to the equilibrium price and quantity?
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A pessimistic view of the 1986 tax reform is that Congress simplified the tax code _____
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A. 3 percent. B. 7 percent. C. 2 percent. D. 5 percent.