Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual unemployment rate is 9 percent. Instructions: Enter your answers as a whole number. a. Use Okun's law to determine the size of the GDP gap in percentage-point terms. percent b. If potential GDP is $500 billion in that year, how much output is forgone because of cyclical unemployment? $1 billion

Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual unemployment rate is 9 percent. Instructions: Enter your answers as a whole number. a. Use Okun's law to determine the size of the GDP gap in percentage-point terms. percent b. If potential GDP is $500 billion in that year, how much output is forgone because of cyclical unemployment? $1 billion

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter20: Aggregate Demand And Supply

Section: Chapter Questions

Problem 20SQ

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