When the Economy Is at Its Potential Output Level,which of the Following

question 65

Multiple Choice

When the economy is at its potential output level,which of the following is not true?

• A)Firms' and workers' expectations about the price level are not accurate.
• B)The nominal wage is a good measure of the expected real wage.
• C)The unemployment rate is about 4 to 6 percent.
• D)The economy is producing its maximum sustainable output.
• E)The actual price level equals the expected price level.

---

Definitions:

Reconstruction

The period after the American Civil War (1865–1877) during which the United States attempted to reintegrate the Confederate states back into the Union and rebuild the South.

Amnesty

A governmental act of forgiveness for individuals or groups who have committed a political offense, often after a conflict or under a new regime.

Attrition Strategy

is a military strategy aiming to gradually wear down the enemy by continuous losses in personnel and material until they are no longer capable of fighting.

Union's Manpower

Refers to the total number of soldiers, workers, and other personnel available to the Union (the Northern states) during the American Civil War for military and labor purposes.