Question 1 Define the output gap and explain in detail the relationship between the output gap and the rate of unemployment in the long and in the short run. Use graphs or sketches of graphs to support your answer.

Question 1 Define the output gap and explain in detail the relationship between the output gap and the rate of unemployment in the long and in the short run. Use graphs or sketches of graphs to support your answer.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 6P

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Step 1: Definition of Output Gap

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Step 2: Relationship Between Output Gap and Unemployment

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Step 3: Graphical Representation

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