If actual output growth is 5% when potential output growth is 5%, then the unemployment rate will:
A) not change.
B) rise.
C) fall.
D) be zero.

Name: If actual output growth is 5% when potential output growth is 5%, then the unemployment rate will: A) not change. B) rise. C) fall. D) be zero.
Brand: Quizplus
Rating: 4.9 (37 reviews)

Question

Quizplus · Accepted Answer

If actual output growth is equal to potential output growth, it means the economy is producing at its full capacity and there is no cyclical unemployment. Therefore, the unemployment rate will not change.

If Actual Output Growth Is 5% When Potential Output Growth