If Real GDP Is Less Than Potential GDP

question 105

Multiple Choice

If real GDP is less than potential GDP,

• A)the price level will not change.
• B)the rate of inflation will not change.
• C)the rate of inflation will increase.
• D)the rate of inflation will decrease.
• E)the price level will fall.

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Definitions:

Oral Contraceptives

A type of birth control that is taken by mouth, including pills that prevent ovulation.

Estrogen

The principal female hormone, regulating reproductive functions and the development of secondary sex characteristics.

Minipill

A type of birth control pill that contains only progestin, which is less likely to cause some of the side effects associated with estrogen-containing pills.

Oral Pills

A form of medication taken by mouth, specifically used here to likely refer to contraceptives used to prevent pregnancy.