Okun's law indicates that for:
A) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 2 percent GDP gap is generated
B) Every 1 percent that the actual unemployment rate exceeds the natural unemployment rate, a 5 percent GDP gap is generated
C) A 5 percent GDP gap, a 1 percent increase in the natural unemployment rate is generated
D) A 2 percent GDP gap, a 2 percent increase in the actual unemployment rate is generated
Correct Answer:
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