An inflationary GDP gap is the amount by which ________ exceeds ________.
A)potential GDP;actual GDP
B)equilibrium output;actual output
C)full-employment GDP;potential GDP
D)equilibrium GDP;full-employment GDP

Question

Quizplus · Accepted Answer

An inflationary GDP gap occurs when equilibrium GDP exceeds full-employment GDP, indicating an economy operating above its sustainable capacity, which can lead to inflation.

An Inflationary GDP Gap Is the Amount by Which ________