Refer to Figure 23-2. Suppose that the level of GDP associated with point N is potential GDP. If the U.S. economy is currently at point K,
A) firms are operating above capacity.
B) the economy is in recession.
C) the level of unemployment is equal to the natural rate.
D) the economy is at full employment.
B
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In the above figure, the inflationary gap can correctly be identified as
A. LRAS minus SRAS. B. AD1. C. the difference between 125 and 120. D. the difference between 12.2 trillion and 12 trillion.
In the context of seeking export opportunities, which of the following is true of large firms?
A) They are intimidated by the complexities and mechanics of exporting to foreign countries. B) They do not consider exporting until after their domestic market is saturated. C) They systematically scan foreign markets to see where the opportunities lie. D) They hesitate to seek export opportunities because they do not know how big the opportunities actually are. E) They tend to be reactive about seeking opportunities for profitable exporting.