If real GDP is less than potential GDP, then the economy is ________ equilibrium.
A) at an above-full-employment
B) not in short-run macroeconomic
C) at a below-full-employment
D) in long-run macroeconomic

Question

Quizplus · Accepted Answer

When real GDP is less than potential GDP, the economy is at a below-full-employment equilibrium, indicating that resources are underutilized and there is unemployment.

If Real GDP Is Less Than Potential GDP, Then the Economy