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Assume the Natural Rate of Unemployment in the U

Question 173

Multiple Choice

Assume the natural rate of unemployment in the U.S. economy is 5 percent and the actual rate of unemployment is 9 percent. According to Okun's law, the negative GDP gap as a percentage of
Potential GDP is


A) 4 percent.
B) 8 percent.
C) 10 percent.
D) 2 percent.

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