According to the AS-AD Model, When Real GDP Exceeds Potential

question 166

Multiple Choice

According to the AS-AD model, when real GDP exceeds potential GDP, the unemployment rate is definitely

• A) less than the natural unemployment rate.
• B) equal to the natural unemployment rate.
• C) greater than the natural unemployment rate.
• D) falling.
• E) rising.

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Definitions:

Trial Balance

A worksheet for accounting where the total balances of all ledgers are arranged into equal debit and credit columns.

Trial Balance

A report that lists all the balances of a company's general ledger accounts to verify that debits equal credits.

Common Stock

A type of equity security that represents ownership in a corporation, with holders having voting rights and potentially receiving dividends.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from revenue, indicating the company's profit.