All of the following are consequences of an economy operating above its potential level except:

Question

Quizplus · Accepted Answer

When an economy operates above its potential level, it typically leads to high rates of inflation, high interest rates, and low unemployment as demand for goods and services exceeds the available supply. However, stable prices are not a consequence of an economy operating above its potential level. Rather, stable prices occur in an economy that is operating at or near its potential level with balanced supply and demand.

All of the Following Are Consequences of an Economy Operating