If Real GDP Is Greater Than Potential GDP, Then

question 36

Multiple Choice

If real GDP is greater than potential GDP, then:

• A) the actual unemployment rate is greater than the natural unemployment rate.
• B) the actual unemployment rate equals zero.
• C) the output gap is negative.
• D) the actual unemployment rate is lower than the natural unemployment rate.

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Definitions:

Average Collection Period

The average number of days it takes for a business to receive payments owed by its customers.

Average Daily Sales

The average amount of sales generated per day over a specific period, commonly used to assess business performance.

Credit Policy

Guidelines that a company follows to determine the creditworthiness of customers, which influence terms of credit and collection procedures.

Total Revenue

The total amount of income generated by the sale of goods or services related to the company's primary operations before any expenses are deducted.