In the Study of Short- Run Fluctuations in National Income

question 93

Multiple Choice

In the study of short- run fluctuations in national income, potential income (output) is usually assumed to be

• A)constant.
• B)moving together with potential output in neighbouring countries.
• C)irrelevant, as the economy is rarely there.
• D)equal to actual income.
• E)falling at its average growth rate.

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