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Potential Real GDP = $200 Billion Natural Rate of Unemployment

Question 67

Multiple Choice

Potential Real GDP = $200 Billion Natural Rate of Unemployment = 6 Percent Actual Rate of Unemployment = 12 Percent Refer to the accompanying data, which is for a specific year in a hypothetical economy for which Okun's law is applicable.If the unemployment rate in the economy fell to 6 percent, we could conclude that


A) only structural unemployment remained.
B) the economy's production possibilities curve shifted outward.
C) the economy had moved from a point inside its production possibilities curve to a point on or very near the curve.
D) nominal GDP would rise, but real GDP would fall.

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