Exhibit 12-3
-In an economy characterized by Exhibit 12-3, there is a recessionary gap.

Name: Exhibit 12-3 -In an economy characterized by Exhibit 12-3, there is a recessionary gap.
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Question

Exhibit 12-3 
-In an economy characterized by Exhibit 12-3, there is a recessionary gap.

Quizplus · Accepted Answer

The economy is producing below the potential output (Yp) indicated by the vertical line at $800 billion, which creates a recessionary gap. The actual output (Y) is shown to be at $700 billion.

Exhibit 12-3 -In an Economy Characterized by Exhibit 12-3, There Is a There