The figure below shows the price level, real GDP, and the potential output for an economy. According to those who favor a passive approach to policy, the economy will attain equilibrium at potential output when:
Definitions:
Density
A physical property defined as an object's mass per unit volume, indicating how compactly the mass is distributed in the object.
Glass
A hard, brittle substance, typically transparent or translucent, made by fusing sand with soda and lime and cooling rapidly.
Density
Density is a measure of mass per unit volume of a substance, indicating how compact its mass is.
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