-Refer to Exhibit 16-5.If the economy is at point 6,and the natural unemployment rate exists at points 1,4,and 5,it follows that

Question

Quizplus · Accepted Answer

If the economy is at point 6 and the natural unemployment rate exists at points 1, 4, and 5, it means the economy is operating below its natural level of output, indicating Real GDP is less than Natural Real GDP (B). This situation is characteristic of a recessionary gap (D), where actual output is less than potential output.