Which of the Following Statements About Output Gaps Is True

Multiple Choice

Which of the following statements about output gaps is true?

A) When actual GDP is above potential GDP, there is upward pressure on wages.
B) When actual GDP is above potential GDP, there is downward pressure on output prices.
C) When actual GDP is above potential GDP, there is downward pressure on wages.
D) When actual GDP is below potential GDP, there is upward pressure on wages.
E) When actual GDP is below potential GDP, there is upward pressure on output prices.