When Real GDP Equals Potential GDP, the Natural Rate of Unemployment

question 47

True/False

When real GDP equals potential GDP, the natural rate of unemployment is zero percent.

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Definitions:

Supply and Demand Functions

Mathematical expressions that describe the relationship between the supply of and demand for goods or services within a market.

Pareto Optimal

A distribution of resources from which it is impossible to reallocate in a way that makes at least one individual better off without making anyone worse off; it constitutes an efficient allocation of resources.

Marginal Rate

A measure of the rate of change in a variable as another variable changes incrementally, often used in the context of taxes or utility.

Cheese Doodles

A popular snack food, typically extruded, corn-based, and coated with a cheese-flavored powder.