Which of the following is true?
A) Real GDP fluctuates around potential GDP.
B) Potential GDP fluctuates around nominal GDP.
C) Nominal GDP fluctuates around real GDP.
D) Real GDP never equals potential GDP.
E) The Okun Gaps are much larger than the Lucas Wedge.
Correct Answer:
Verified
Q25: Over the business cycle,real GDP fluctuates around
A)the
Q26: The idea of "diminishing returns" means that
Q27: The production function is a relationship between
Q28: Choose which statement is most correct.
A)Real GDP
Q29: As an economic expansion approaches its peak,it
Q31: Diminishing returns means that
A)each additional unit of
Q32: The production function displays
A)increasing returns.
B)real returns.
C)diminishing returns.
D)average
Q33: To determine GDP from the production function,we
Q34: During a business cycle recession,it is very
Q35: According to the production function,as the quantity
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