If Real GDP Exceeds Potential GDP

question 175

Multiple Choice

If real GDP exceeds potential GDP,

• A) there can be a short- run equilibrium with a recessionary gap.
• B) there is neither a long- run nor a short- run equilibrium.
• C) there is a long- run and a short- run equilibrium.
• D) there can be a short- run equilibrium with an inflationary gap.

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Definitions:

Multiple R

Represents a measure of the correlation between observed and predicted values of a variable in multiple regression analysis, indicating the strength and direction of a linear relationship.

Autocorrelation

A measure of how correlated a variable is with itself over successive time intervals, often used in time series analysis.

Significance F

A statistical measure used in the analysis of variance (ANOVA) to determine the likelihood that the observed differences among group means occur by chance.

Null Hypothesis

A statistical hypothesis that suggests there is no significant difference between specified populations or no effect.