During an inflationary gap:
A) the unemployment rate is less than the natural rate of unemployment.
B) actual output is less than potential output.
C) the unemployment rate is equal to the natural rate of unemployment.
D) wages and prices must fall to restore the economy to its potential output.
Correct Answer:
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Q230: If an economy finds itself in a
Q231: Disinflation:
A)entails eliminating inflation in an economy.
B)policy is
Q232: When inflation is high:
A)people will increase their
Q233: Which of the following could lead to
Q234: Okun's law finds that output gaps and
Q236: A negative output gap is associated with
Q237: The long-run Phillips curve shows that:
A)there is
Q238: The short-run Phillips curve:
A)depicts the positive relationship
Q239: The long-run Phillips curve:
A)depicts the negative relationship
Q240: During a liquidity trap:
A)monetary policy is ineffective,
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