When Actual Output Is Less Than Potential Output, There Is

question 47

Multiple Choice

When actual output is less than potential output, there is ______ output gap and the inflation rate will ____.

• A)an expansionary; exceed the expected rate of inflation
• B)an expansionary; be lower than the expected rate of inflation
• C)a recessionary; be lower than the expected rate of inflation
• D)a recessionary; exceed the expected rate of inflation

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Definitions:

International Business

The exchange of goods, services, technology, and capital across national borders, involving transactions that plan for global outreach and operational strategies.

Local Operation

The activities, functions, or processes that are carried out within a specific geographical location or community.

Multinational Corporation

A company that operates in multiple countries, managing production or delivering services in more than one country beyond its home country.

International Operations

Business activities that are conducted across national borders.