In the macroeconomic long run,
A) GDP always is below potential GDP.
B) there is full employment with no unemployment.
C) there is full employment and real GDP is equal to potential GDP.
D) output always is above potential GDP.

Question

Quizplus · Accepted Answer

In the macroeconomic long run, the economy is able to adjust and reach full employment, where all available resources are utilized, leading to real GDP being equal to potential GDP. This creates a balanced economy where there is no cyclical or involuntary unemployment. Therefore, option C is the correct choice.

In the Macroeconomic Long Run