The difference between the economy's potential output and its actual output relative to its potential output at a point in time is called the:

Apples are a normal good, so if the price of an apple increases from 50¢ to 60¢, the quantity of apples demanded decrease because of

A) the substitution effect only. B) the income effect only. C) a change in income. D) the substitution and income effects.

If a small change in price will lead to an infinite change in the quantity demanded, then the demand curve is: a. Perfectly elastic

b. Perfectly inelastic. c. Downward sloping. d. non-linear