At Full Employment,actual ________ Equals ________

question 309

Multiple Choice

At full employment,actual ________ equals ________.

• A)nominal GDP;potential GDP
• B)real GDP;potential GDP
• C)real GDP;nominal GDP
• D)potential GDP;nominal GDP
• E)unemployment;zero

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Definitions:

Minimum Average Total Cost

The lowest point on the curve that shows the average cost of producing each unit of output when all input costs are considered over various output levels.

Marginal Cost

The cost added by producing one additional unit of a product or service.

Long-Run Equilibrium

A state in which all factors of production are variable, allowing firms to adjust their inputs in response to market conditions, resulting in no firm having an incentive to enter or exit the market.

Allocative Efficiency

A state of resource allocation where goods and services are distributed according to consumer preferences, reflecting the highest possible welfare.