When Actual Output Is Less Than Potential Output, There Is

question 47

Multiple Choice

When actual output is less than potential output, there is ______ output gap and the inflation rate will ____.

• A)an expansionary; exceed the expected rate of inflation
• B)an expansionary; be lower than the expected rate of inflation
• C)a recessionary; be lower than the expected rate of inflation
• D)a recessionary; exceed the expected rate of inflation

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Definitions:

Mean Square

The average of the squares of the differences between the observed and expected values, used in various statistical methods, such as ANOVA.

Main Effect

In analysis of variance, the direct influence of an independent variable on a dependent variable, discounting interactions with other variables.

Factor A

A variable manipulated or monitored to determine its effects on an outcome in an experiment.

Critical Value

A threshold value that separates the region where the null hypothesis is rejected from the region where it is not rejected, based on the chosen significance level.