Given the path of natural real GDP growth,economists prefer an economy such as ________,in which the real GDP gaps are ________.
A)Stabilia's,minimized
B)Stabilia's,maximized
C)Volatilia's,minimized
D)Volatilia's,maximized

Question

Quizplus · Accepted Answer

Economists prefer an economy where the real GDP gaps are minimized, meaning that the actual output of goods and services is close to the potential output. Stabilia's, as the name suggests, represents an economy that is stable and experiences less fluctuation in terms of economic activity and growth. Therefore, A) is the best choice as it aligns with the preferences of economists.

Given the Path of Natural Real GDP Growth,economists Prefer an Economy