The Figure Below Shows the Price Level,real GDP,and the Potential

question 90

Multiple Choice

The figure below shows the price level,real GDP,and the potential output for an economy.According to those who favor a passive approach to policy,once the expansionary gap is eliminated,the economy will end up at:​ ​
Figure 16.2
​

• A)point A.
• B)point B.
• C)point C.
• D)a point to the right of point A.
• E)a point below C.

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Definitions:

Wage-gap

is the difference in average earnings between different groups of workers, often used to discuss disparities based on gender, race, or education.

Migration Costs

Expenses and sacrifices associated with moving from one location to another, which can include monetary costs, emotional strain, and time.

Substitute Resources

Resources or inputs that can be used in place of each other in the production process.

Inelastic

Describes a situation where a change in price leads to a relatively smaller change in the quantity demanded or supplied.