When the current state of the economy is such that Real GDP is less than Natural Real GDP,the economy is in a(n)____________________ gap.In this situation,the (actual)unemployment rate is ___________ than the natural unemployment rate,and there is a ________________ in the labor market.
A) recessionary; greater; shortage
B) inflationary; less; shortage
C) inflationary; greater; surplus
D) recessionary; greater; surplus
E) recessionary; less; shortage

Question

Quizplus · Accepted Answer

When Real GDP is less than Natural Real GDP, the economy is in a recessionary gap. In this situation, the (actual) unemployment rate is greater than the natural unemployment rate, and there is a surplus in the labor market.

When the Current State of the Economy Is Such That