If potential output is ________ than the current level of GDP, the unemployment rate is ________ the natural rate.
A) greater; above
B) greater; below
C) less; above
D) less; at

Question

Quizplus · Accepted Answer

When potential output is greater than the current level of GDP, it indicates that the economy is not producing at its full capacity, which typically results in a higher unemployment rate than the natural rate.

If Potential Output Is ________ Than the Current Level of GDP