The economy pictured in the figure below has a(n) ____ gap with a short-run equilibrium combination of inflation and output indicated by point ___.

Name: The economy pictured in the figure below has a(n) ____ gap with a short-run equilibrium combination of inflation and output indicated by point ___.
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Question

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This economy has a recessionary gap because the short-term equilibrium level of output, which is where AD and SRAS meet at point A, is less than the potential output level Y*.

The Economy Pictured in the Figure Below Has A(n) ____