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If the Economy Is in Equilibrium with Real GDP Less

question 208

Multiple Choice

If the economy is in equilibrium with real GDP less than potential GDP,there is ________ gap and a fiscal policy that ________ is appropriate.


Definitions:

Great Depression

A severe worldwide economic downturn that lasted throughout the 1930s, marked by high unemployment and deflation.

World War II

A global conflict that lasted from 1939 to 1945, involving most of the world's nations and marked by significant events and battles across various continents.

Automatic Stabilizer

A government policy or program designed to counteract fluctuations in the nation's economic activity without intervention by policymakers, thereby stabilizing the economy over the business cycle.

Unemployment Insurance

A government program that provides financial assistance to unemployed workers who have lost their jobs through no fault of their own.

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