Which of the Following Would Be Evidence That a Contractionary

Multiple Choice

Which of the following would be evidence that a contractionary gap exists?

A) Rapid deflation during a period in which plant capacity utilization is below average.
B) A steady price level and a 5 percent unemployment rate.
C) Help wanted advertising lower than usual,and the consumer price index lower than expected.
D) Inflation has risen markedly and the Dow Jones average is at record levels.
E) The number of new unemployment claims has skyrocketed and the price level is rising.