Empirical Evidence for Canada Suggests That If Actual GDP Grows

Multiple Choice

Empirical evidence for Canada suggests that if actual GDP grows by 2 percent a year and potential GDP grows by 3 percent a year:

A) the unemployment rate will be unchanged.
B) the unemployment rate will fall by 1 percentage point.
C) the unemployment rate will rise by ½ of one percentage point.
D) the economy will experience and inflationary gap.