If the Potential Output of an Economy Is Worth $440

question 5

Multiple Choice

If the potential output of an economy is worth $440 billion and the actual output during a particular year was $435 billion, the output gap is

• A)­​1.14 percent
• B)​2.2 percent
• C)​­5 percent
• D)​1.1 percent

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Definitions:

Instability

A state characterized by lack of consistency or predictability in actions, events, or conditions.

Lack Of Construction

The absence or deficiency in building or assembling structures or ideas.

Fluctuating

Describes something that is changing frequently in level, strength, or value, often with no fixed pattern.

Differentiated

Tailoring education or activities to meet the different needs, interests, abilities, or learning styles of individuals or groups.