Y* If Y* indicates potential output and the economy is in equilibrium, which of the following statements must be true? Select one: O a. The rate of cyclical unemployment is positive. O b. There is an unplanned fall in business inventories. c. Real GDP will increase until Y* = Y. d. There is an expansionary output gap. е. PAE will automatically fall until Y = Y*.

Y* If Y* indicates potential output and the economy is in equilibrium, which of the following statements must be true? Select one: O a. The rate of cyclical unemployment is positive. O b. There is an unplanned fall in business inventories. c. Real GDP will increase until Y* = Y. d. There is an expansionary output gap. е. PAE will automatically fall until Y = Y*.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter11: Managing Aggregate Demand: Fiscal Policy

Section: Chapter Questions

Problem 2TY

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