Which of the Following Is True in the Short Run

question 138

Multiple Choice

Which of the following is true in the short run but not in the long run?

• A)Actual output is equal to potential output.
• B)Actual output can exceed potential output.
• C)Structural unemployment can exist.
• D)Frictional unemployment can exist.
• E)Real and nominal GDP can differ.

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Definitions:

Par Value

A nominal value assigned to a security, such as a stock, which is stated in the corporate charter and often bears no relation to its market value.

Price-Earnings Ratio

A valuation metric for a company's current share price relative to its per-share earnings, indicating how much investors are willing to pay for each dollar of earnings.

Earnings Per Share

A financial metric that calculates the portion of a company's profit allocated to each outstanding share of common stock.

Market Price

The present cost at which a service or asset is available for purchase or sale.