What Is Potential GDP? What Happens to Unemployment When GDP

question 58

Essay

What is potential GDP? What happens to unemployment when GDP is at its potential?

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Definitions:

Direct Labor

The cost of wages for workers directly involved in the manufacturing or production of goods.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a product and are considered variable costs.

Cost Of Goods Manufactured

The total production cost of goods completed during a specific period.

Work In Process Inventory

Inventory that consists of items in the production process but not yet completed, considered a current asset on the balance sheet.