In Okunland, a Country That Operates According to Okun's Law

question 87

Multiple Choice

In Okunland, a country that operates according to Okun's law, real GDP equals $7,520 billion, potential GDP equals $8,000 billion, and the actual unemployment rate is 8 percent. What is the natural rate of unemployment in Okunland?

• A) 2 percent
• B) 5 percent
• C) 6 percent
• D) 11 percent