Which of the Following Occurs If an Economy Experiences an Inflationary

question 126

Multiple Choice

Which of the following occurs if an economy experiences an inflationary gap?
I. Actual real GDP is less than potential output.
II. Actual real GDP is greater than potential output.
III. Unemployment is less than the natural rate.
IV. Unemployment is greater than the natural rate.

• A) I and III
• B) I and IV
• C) II and III
• D) II and IV

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Definitions:

Business Consultants

Professionals who provide expert advice in a particular area of business, such as management, operations, or marketing, to help organizations improve performance.

Index

A statistical measure or indicator often used in finance to represent the performance of a group of assets or a sector of the market.

Interpret

To explain or provide the meaning of something, often requiring analysis or understanding of context.

Quality

pertains to the degree of excellence or superiority that a product, service, or process possesses.