Which of the Following Is True

question 44

Multiple Choice

Which of the following is true?

• A)Real GDP fluctuates around potential GDP.
• B)Potential GDP fluctuates around nominal GDP.
• C)Nominal GDP fluctuates around real GDP.
• D)Real GDP never equals potential GDP.
• E)The Okun Gaps are much larger than the Lucas Wedge.

---

Definitions:

Work in Process Account

An account in the general ledger that accumulates costs related to partially completed products during a specific accounting period.

Job Order Costing Method

A costing method used to accumulate costs of production by job or order, suitable for customized or unique products and services.

Service Organization

A business that provides professional services or expertise to clients, rather than tangible goods.

Period Costs

Expenses that are not directly tied to the production process and are expensed in the period they are incurred, such as sales and administrative expenses.