Examlex

Solved

Suppose the GDP Deflator Is 100 in 2009 and 101

question 152

Essay

Suppose the GDP deflator is 100 in 2009 and 101 in 2010.
(A)Suppose the economy is at potential GDP in 2009 and 2010.What is the rate of inflation in 2010?
(B)Suppose instead that real GDP is above potential GDP in 2010.How is the adjustment back to potential made in this situation?


Definitions:

Labor Force

The total number of people employed or seeking employment in a country or region.

Global Economy

The interconnected worldwide economic activities that determine the production, distribution, and consumption of goods and services across different countries.

Assembly

The act of gathering or coming together of a group of people, typically for a specific purpose or action.

Increased Employment

A situation or condition where the number of people who are employed grows, indicating economic growth or recovery.

Related Questions