In its macroeconomic equilibrium, the economy can be producing at i. below full employment.
Ii. full employment.
Iii. above full employment.
A)i only
B)ii only
C)iii only
D)i or ii
E)i, ii, or iii

Question

Quizplus · Accepted Answer

In macroeconomic equilibrium, an economy can be at any of the three states: below full employment (recessionary gap), at full employment (natural level of output), or above full employment (inflationary gap).

In Its Macroeconomic Equilibrium, the Economy Can Be Producing at I