According to the AS-AD Model, When Real GDP Is Less

question 90

Multiple Choice

According to the AS-AD model, when real GDP is less than potential GDP the unemployment rate is definitely

• A)equal to the natural unemployment rate.
• B)falling.
• C)rising.
• D)less than the natural unemployment rate.
• E)greater than the natural unemployment rate.

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Definitions:

Cash Dividend

A payment made by a corporation to its shareholders, usually in the form of cash.

Net Income

The profit a company retains after all financial obligations, like costs and taxes, are subtracted from its total income.

Cost Method

An accounting method used to value inventory or investments at their original purchase cost.

Equity Method

An accounting technique used by a company to record its investment in another company.