If the economy experiences an unplanned inventory accumulation at the full employment level of GDP, then the economy is in a(n)

A. inflationary gap.
B. hyperinflation.
C. recessionary gap.
D. full employment gap.

Answer: C

Economics

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Money as a medium of exchange I. Facilitates the exchange of goods II. Reduces the incentive to barter

A) I only B) II only C) Both I and II D) Neither I nor II

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When the economy enters a prosperity phase, personal income tax collections

a. fall along with consumption and real GDP b. rise along with real GDP but unemployment insurance payments to workers fall c. rise but real GDP and unemployment insurance payments to workers fall d. fall along with real GDP but unemployment insurance payments to workers rise e. fall causing real incomes and employment to fall

Economics