In the long run
A)GDP potential GDP.
B)unemployment is at its natural rate.
C)LRAS and SRAS lie on the same line.
D)the inflation rate is zero.

Question

In the long run
A)GDP > potential GDP.
B)unemployment is at its natural rate.
C)LRAS and SRAS lie on the same line.
D)the inflation rate is zero.

Quizplus · Accepted Answer

In the long run, unemployment is at its natural rate, which is the rate associated with the economy's potential output level. The other options are not necessarily true in the long run - GDP may be above or below potential, LRAS and SRAS may not necessarily lie on the same line, and there may be some level of inflation present.

In the Long Run