Potential Output Is

question 20

Multiple Choice

Potential output is:

• A)equal to actual output.
• B)also known as the output gap.
• C)the same as the natural rate of unemployment.
• D)the maximum sustainable amount of output.

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Definitions:

Market Value

The ongoing purchase or sale price of an asset or service.

Firm Commitment Underwriting

A type of underwriting where the underwriter buys the entire offering from the issuer and sells it to investors, assuming full financial risk.

Underwriting Spread

The difference between the amount underwriters pay to acquire securities from the issuer and the price at which they sell these securities to investors.