A Recessionary Output Gap Implies That

question 104

Multiple Choice

A recessionary output gap implies that

• A)the demand for all factor services will be relatively low.
• B)the intersection of AD and AS occurs where real GDP exceeds potential output.
• C)the economy's resources are being used at more than their normal capacity.
• D)there is upward pressure on wages.
• E)there is excess demand for most factors of production.

---

Definitions:

Strength And Importance

Terms reflecting the power, effectiveness, and significance of something or someone in a given context.

Electorate

The collective body of individuals who have the legal right to participate in electing officials, reflecting the democratic principle.

Realignment

A significant shift in the political landscape, often characterized by changes in party allegiance, voting patterns, or the emergence of new political issues.

Political Party

An organized group of people with similar political aims and opinions that seeks to influence public policy by getting its candidates elected to public office.