At potential GDP
A) unemployment is at its natural rate.
B) there is no unemployment but there is not necessarily full employment.
C) there is no unemployment and there is full employment.
D) None of the above is correct.

Question

Quizplus · Accepted Answer

At potential GDP, the economy is operating at full capacity, meaning unemployment is at its natural rate, which includes frictional and structural unemployment but not cyclical unemployment.

At Potential GDP