When actual output is greater than potential output there is an A budget

# When actual output is greater than potential output

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49.When actual output is greater than potential output there is a(n): A. budget deficit. B. budget surplus. C.expansionary gap. D. recessionary gap. AACSB: Analytical Skills Blooms: Knowledge Frank - Chapter 20 #49 Learning Objective: 20- 03 Define potential output, measure the output gap, and use these concepts to analyze an economy’s position in the business cycle. Section: Output Gaps and Cyclical Unemployment

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50.If potential output equals \$8 billion and actual output equals \$7 billion, then this economy has a(n): AACSB: Analytical Skills Blooms: Application Frank - Chapter 20 #50 Learning Objective: 20-03 Define potential output, measure the output gap, and use these concepts to analyze an economy’s position in the business cycle. Section: Output Gaps and Cyclical Unemployment
51.If potential output equals \$8 billion and actual output equals \$9 billion, then this economy has a(n): AACSB: Analytical Skills Blooms: Application Frank - Chapter 20 #51 Learning Objective: 20-03 Define potential output, measure the output gap, and use these concepts to analyze an economy’s position in the business cycle. Section: Output Gaps and Cyclical Unemployment

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52.For policymakers the problem with a recessionary gap is _____ and the problem with an expansionary gap is _____. AACSB: Reflective Thinking Skills Blooms: Understanding Frank - Chapter 20 #52 Learning Objective: 20- 03 Define potential output, measure the output gap, and use these concepts to analyze an economy’s position in the business cycle. Section: Output Gaps and Cyclical Unemployment
53.In Macroland potential GDP equals \$8 trillion and real GDP equals \$7.44 trillion. Macroland has a(n) _________ gap equal to _____ percent of potential GDP. A. recessionary; -56B. expansionary; 7C. expansionary; 56D.recessionary; -7 AACSB: Analytical Skills Blooms: Application Frank - Chapter 20 #53 Learning Objective: 20- 03 Define potential output, measure the output gap, and use these concepts to analyze an economy’s position in the business cycle. Section: Output Gaps and Cyclical Unemployment

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