The Following Information Is for a Specific Year in a Hypothetical

question 64

Multiple Choice

The following information is for a specific year in a hypothetical economy for which Okun's law is applicable:
Potential Real GDP = $200 billion
Natural rate of unemployment = 6 percent
Actual rate of unemployment = 12 percent
-The amount of output being forgone by the above economy is:

• A) $12 billion.
• B) $15 billion.
• C) $18 billion.
• D) $24 billion.

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Definitions:

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