In Any Year, Real GDP

question 37

Multiple Choice

In any year, real GDP

• A)must always be less than potential GDP.
• B)might be greater than, less than, or equal to potential GDP.
• C)will always be greater than potential GDP because of the tendency of nations to incur inflation.
• D)always equals potential GDP.
• E)increases if potential GDP increases, and decreases if potential GDP decreases.

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Definitions:

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