An inflationary gap refers to the gap between real GDP and potential GDP when the level of output is below the level of potential GDP

You have an absolute advantage whenever you

A) are better educated than someone else. B) can produce something at a lower opportunity cost than others. C) prefer to do one particular activity. D) can produce more of something than others with the same resources.

The Taylor rule

A) is a rule stating that money should grow at a constant rate. B) is not considered to be a practical policy rule for central banks to follow. C) dictates that the central bank's target interest rate be responsive to real economic activity and to inflation. D) dictates that the nominal interest rate stay constant in the long run.