An Output Gap Is

question 155

Multiple Choice

An output gap is

• A) negative during a recession.
• B) positive during a recession.
• C) negative if real GDP is above potential GDP.
• D) positive if real GDP is above potential GDP.
• E) positive during an expansion.

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Definitions:

Final Payment

The final payment is the last installment paid in a payment schedule, settling the remaining balance of a financial obligation.

Compounded Monthly

A method where the interest earned on an investment is calculated and added to the principal every month.

Equal Payments

Regular payments of the same amount over a specified period, often used in loan repayment plans.

Compounded Quarterly

Interest calculation on the initial amount plus any accumulated interest four times a year.