An Inflationary Output Gap Occurs When

question 34

Multiple Choice

An inflationary output gap occurs when

• A)actual GDP exceeds potential GDP.
• B)nominal GDP exceeds real GDP.
• C)demand for labour services is very low.
• D)equilibrium national income is below potential national income.
• E)potential GDP exceeds actual GDP.

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Definitions:

Asmat

A group of people living in the Papua region of Indonesia, known for their woodcarving and other artworks.

Moai

Large, blocky figural stone sculptures found on Rapa Nui (Easter Island) in Polynesia.

Rapa Nui

An island in the southeastern Pacific Ocean, known for its monumental statues called moai, created by the early Rapa Nui people.

Abelam Culture

A society located in the East Sepik Province of Papua New Guinea, known for their elaborate yam festivals and impressive ceremonial houses called haus tambarans.