An Inflationary Gap Is the Amount by Which

question 83

Multiple Choice

An inflationary gap is the amount by which

• A)potential GDP exceeds real GDP.
• B)demand must increase to achieve full employment at a given price level.
• C)supply must increase to achieve full employment at a given price level.
• D)the price level must adjust to achieve full employment.
• E)real GDP exceeds potential GDP.

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Definitions:

Marginal Cost

The swell in total charges associated with crafting an additional unit of a good or service.

Average Variable Cost

The total variable cost divided by the quantity of output produced, representing the variable cost for each unit of output.

Meals

Prepared food items or servings eaten or intended to be eaten at any particular time, such as breakfast, lunch, or dinner.

Marginal Cost

The increment in total financial output required for producing one more unit of a product or service.