When real GDP is below natural real GDP,the unemployment rate is

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Quizplus · Accepted Answer

When real GDP is below natural real GDP, it indicates that the economy is producing below its full potential. This usually occurs during recessions, which are typically characterized by rising unemployment rates as firms reduce production and lay off workers due to the decline in demand for goods and services. Therefore, real GDP below natural real GDP is associated with a rising unemployment rate.

When Real GDP Is Below Natural Real GDP,the Unemployment Rate