If, at the prevailing rate of inflation, real GDP is less than potential GDP, the economy has not fully recovered from a recession.

Question

Quizplus · Accepted Answer

If real GDP is less than potential GDP, it means that the economy is producing below its full capacity, which indicates that there is still room for growth and improvement. This is consistent with an economy that has not fully recovered from a recession.

If, at the Prevailing Rate of Inflation, Real GDP Is