Full-Employment Equilibrium Occurs When

question 2

Multiple Choice

Full-employment equilibrium occurs when

• A)aggregate demand equals short-run aggregate supply.
• B)all who are willing and able to work, are working.
• C)real GDP equals potential GDP.
• D)real GDP equals potential GDP and the wage level is set so that the GDP deflator equals 100.
• E)all who are willing and able to work are working, and the wage level is set so that the GDP deflator equals 100.

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Definitions:

Process Operations

A method of production that involves continuous processing of materials to produce goods or provide services.

Work In Process Inventory

The account on the balance sheet representing the cost of the incomplete goods that are still in the process of production.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, converting them into the amount of finished goods units they represent.

Equivalent Units

A concept in cost accounting used to apportion costs to partially completed goods, expressed in terms of fully completed units.