When an Expansionary Gap Exists,actual Output _________ Potential Output and the Rate

question 205

Multiple Choice

When an expansionary gap exists,actual output _________ potential output and the rate of inflation will tend to __________.

• A) is greater than;increase
• B) is greater than;decrease
• C) equals;remain the same
• D) is less than;increase
• E) is less than;decrease

---

Definitions:

Viable Alternative

A practical and achievable option among various solutions that has the potential to effectively resolve an issue or meet objectives.

Satisfactory Agreement

An agreement that meets the acceptable standards or needs of the parties involved.

Specific Target Point

This is a predefined objective or goal that one or both parties aim to achieve in a negotiation or bargaining situation.

Resistance Point

The least favorable outcome that a negotiator is willing to accept before walking away from the negotiation table.