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

question 19

Multiple Choice

In Macroland, potential output equals $100 trillion and the natural rate of unemployment is 4 percent. If the actual unemployment rate is 3 percent, then real GDP equals:

• A) $98 trillion.
• B) $99 trillion.
• C) $101 trillion.
• D) $102 trillion.

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Definitions:

Executive Agencies

Agencies of the executive branch of government responsible for enforcing laws and regulations within their respective areas of authority.

Independent Agencies

Government bodies that operate independently of the executive branch, often created to regulate or oversee specific sectors or issues.

Informal Rule Making

A regulatory process where governing bodies develop and issue rules or regulations without engaging in formal procedures such as public hearings.

Notice-and-Comment

A procedure required by law whereby a government agency must publish a proposed rule and allow the public to comment on it before it becomes enacted.