As actual output falls below the potential level,which of the following must be true?
A)more resources become unemployed
B)prices remain constant
C)real GDP rises
D)nominal GDP remains constant
E)production rises

Question

Quizplus · Accepted Answer

As actual output falls below potential level, there will be a decrease in demand for resources which would lead to a decrease in employment, causing more resources to be unemployed.

As Actual Output Falls Below the Potential Level,which of the Following