In Macroland,potential Output Equals $100 Trillion and the Natural Rate

question 125

Multiple Choice

In Macroland,potential output equals $100 trillion and the natural rate of unemployment is 4%.If the actual unemployment rate is 5%,then the output gap equals

• A) - $2 trillion.
• B) - $1 trillion.
• C) $1 trillion.
• D) $2 trillion.
• E) $9 trillion.

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Definitions:

Sales Budget

A detailed estimate of the sales revenue a company expects to earn in a specific period, including both volume and price.

Merchandise Purchases

Transactions related to buying inventory for resale, typically in a retail or wholesale business setting.

Beginning Cash Balance

Beginning cash balance is the amount of cash available at the start of a financial period, carrying over as the ending balance from the previous period.

Ending Cash Balance

The amount of cash available at the end of a financial period.