An inflationary gap is the amount by which
A) total planned production exceeds total planned real expenditures in the long run.
B) the short-run equilibrium level of nominal GDP is above the short-run level of real GDP.
C) the short-run equilibrium level of nominal GDP is below the short-run level of real GDP.
D) the short-run equilibrium level of real GDP is above the full-employment level of real GDP.
D
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Explain the purpose of payroll taxes. Is it a proportional form of tax?
What will be an ideal response?
One reason nonunionized firms do not always drive unionized firms out of business is that:
A. unionized firms hire more selectively, employing workers with greater human capital. B. unionized firms reduce the value of total output. C. markets are not competitive. D. unionized firms receive government subsidies.