If real GDP exceeds potential GDP, then employment is ________ full employment and the unemployment rate is ________ the natural unemployment rate.
A) below; above
B) equal to; below
C) above; below
D) above; above
E) equal to; equal to

Question

Quizplus · Accepted Answer

When real GDP exceeds potential GDP, the economy is operating above full employment, leading to an unemployment rate below the natural unemployment rate.

If Real GDP Exceeds Potential GDP, Then Employment Is ________