In Macroland, Potential Output Equals $100 Trillion and the Natural

question 94

Multiple Choice

In Macroland, potential output equals $100 trillion and the natural rate of unemployment is 4 percent. If the actual unemployment rate is 5 percent, then real GDP must be:

• A)$98 trillion.
• B)$96 trillion.
• C)$102 trillion.
• D)$104 trillion.

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Definitions:

Power Resource Theories

A group of theories arguing that the balance of power among classes and groups determines the outcome of their interactions, including policy decisions.

War

A state of armed conflict between different nations or states or different groups within a nation or state.

Terrorism

Employing force and coercion, particularly targeting non-combatants, to achieve political goals.

Pluralist

An advocate or supporter of a political theory that recognizes the diversity of interests within a society and affirms that this diversity should be reflected in governance.