Use the Following Table to Answer the Following Questions

question 25

Multiple Choice

Use the following table to answer the following questions:

-According to the table,the labor force participation rate in this economy is equal to

• A) 4.9 percent.
• B) 92.2 percent.
• C) 63.4 percent.
• D) 7.8 percent.
• E) 8.5 percent.

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Definitions:

Inflationary Gap

Occurs when equilibrium GDP is greater than full-employment GDP.

Equilibrium GDP

The level of Gross Domestic Product where aggregate supply equals aggregate demand, indicating a stable economy with no tendency for change in the price level or output.

Multiplier

Any change in spending (C, I, or G) will set off a chain reaction leading to a multiplied change in GDP. Equation is 1/(1 - MPC).

Federal Budget Deficit

A situation where the government's expenditures exceed its revenues over a specific fiscal period.