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The Table Shows the Percentage Difference Between Real and Potential

Question 159

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The table shows the percentage difference between real and potential GDP and the rate of inflation for the years 2006 through 2015. If there was a presidential election in the year 2007, would these data support the view that there was a political business cycle during this period?
 Year  Percentage Difference  Between Realand  Potential GDP  Inflation Rate 20060.3%3.2%20070.2%2.9%20081.8%3.8%20096.2%0.3%20104.6%1.6%20114.0%3.1%20123.0%2.1%20132.9%1.5%20142.1%1.6%20151.2%0.1%\begin{array}{|c|c|c|}\hline \text { Year } & \begin{array}{c}\text { Percentage Difference } \\\text { Between Realand } \\\text { Potential GDP }\end{array} & \text { Inflation Rate } \\\hline 2006 & 0.3 \% & 3.2 \% \\\hline 2007 & 0.2 \% & 2.9 \% \\\hline 2008 & -1.8 \% & 3.8 \% \\\hline 2009 & -6.2 \% & -0.3 \% \\\hline 2010 & -4.6 \% & 1.6 \% \\\hline 2011 & -4.0 \% & 3.1 \% \\\hline 2012 & -3.0 \% & 2.1 \% \\\hline 2013 & -2.9 \% & 1.5 \% \\\hline 2014 & -2.1 \% & 1.6 \% \\\hline 2015 & -1.2 \% & 0.1 \% \\\hline\end{array}

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No. Notice that the gap between real and...

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