The Output Gap Is Positive During an Inflationary Gap

question 107

True/False

The output gap is positive during an inflationary gap.

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Definitions:

Total Cost

The complete cost of production including fixed and variable costs.

Average Total Cost

The total of all costs divided by the number of goods produced, representing the per unit production cost.

Output

The total amount of goods or services produced by an individual, company, or country.

Total Variable Cost

The sum of all costs that vary with output level in the production process.