In macroeconomics, the "output gap" is the difference between
A)output in the current year and output in the base year.
B)potential real national income and actual real national income.
C)output and employment.
D)real GNP and real GDP.
E)real and nominal national income.

Question

Quizplus · Accepted Answer

The output gap is the difference between potential real national income (the amount the economy could produce at full employment) and actual real national income (the amount the economy is currently producing). This difference can be positive or negative and represents the amount of unused or overused resources in the economy.

In Macroeconomics, the "Output Gap" Is the Difference Between