In the diagram displaying Okun's law,the data points loop around the summarizing "Okun's law line" in a ________ direction because the unemployment rate reacts to changes in production ________.
A)clockwise,in advance
B)clockwise,with a lag
C)counterclockwise,in advance
D)counterclockwise,with a lag

Question

Quizplus · Accepted Answer

Okun's law illustrates the relationship between unemployment and economic growth, specifically how changes in the unemployment rate tend to follow changes in economic output with a lag. This means that the unemployment rate typically reacts to changes in production after they have occurred, leading to a clockwise pattern of data points around the Okun's law line in a diagram.

In the Diagram Displaying Okun's Law,the Data Points Loop Around