In Which of the Following Cases Is the Output Gap

question 61

Multiple Choice

In which of the following cases is the output gap zero?

• A) When consumer con?dence declines due to bad economic performance.
• B) When the economy operates on its production possibility frontier.
• C) When unemployment increases due to an increase in real wages.
• D) When in?ation in the economy is equal to its target level.

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Definitions:

Psychological Disorders

Conditions characterized by abnormal thoughts, feelings, and behaviors that may cause distress or impair function in life.

Psychotherapy

A therapeutic treatment involving psychological techniques, used to treat mental health problems and emotional challenges.

Depression

A common and serious medical illness that negatively affects how you feel, the way you think, and how you act, offering a persistent feeling of sadness and loss of interest.

Pleasure Centers

Pleasure centers are areas of the brain, notably within the limbic system, that are activated by rewarding stimuli, leading to feelings of pleasure.