An Inflationary Output Gap Is Characterized by

question 149

Multiple Choice

An inflationary output gap is characterized by

• A)falling prices.
• B)constant prices.
• C)real output that varies one-for-one with aggregate demand.
• D)real GDP exceeding potential output.
• E)real GDP falling below potential output.

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Definitions:

Stare Decisis

The legal principle of determining points in litigation according to precedent.

Binding Precedent

A previous case that a particular court must follow.

Courts

Institutions that interpret and apply the law to resolve disputes and administer justice in civil, criminal, and administrative matters.

Precedent

A legal decision or case that serves as an example or authority for deciding subsequent cases involving similar facts or issues.