The Economy's Output Gap Is Defined as the

question 96

Multiple Choice

The economy's output gap is defined as the

• A)difference between actual national income and desired aggregate expenditure.
• B)result of economic growth.
• C)difference between nominal GDP and real GDP.
• D)level of total output that would be produced if capacity utilization is at its normal rate.
• E)difference between actual GDP and potential GDP.

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Definitions:

Sand Dunes

Hills or ridges of sand piled up by the wind in desert environments or near beaches.

Meandering River

A river that has a strongly curved channel (with meanders).

Open Ocean

The vast, deep part of the sea that is not close to the coast or beyond the continental shelf.

Graded Bedding

A geological structure in which each layer of sediment is progressively heavier or finer, indicating deposition over time.