The Gap That Exists When Equilibrium Real GDP Is Less

question 50

Multiple Choice

The gap that exists when equilibrium real GDP is less than full-employment real GDP is

• A) the short-run aggregate supply curve.
• B) money illusion.
• C) a recessionary gap.
• D) an inflationary gap.

---

Definitions:

Joseph Galloway's Plan

A proposal made by Joseph Galloway in 1774 during the First Continental Congress to seek a reconciliation between the American colonies and Great Britain, which was ultimately rejected leading towards the path of independence.

Taxation

The process by which governments finance their expenditure by imposing charges on citizens and corporate entities.

Legislation

Laws or statutes enacted by a governing body to regulate, authorize, sanction, grant, declare, or restrict various activities.

Virtual Representation

The concept that the British government claimed gave American colonists political representation through the Parliament, despite the colonists having no actual representatives.