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A Country Reports That Its Actual Real GDP Is Greater

Question 255

Multiple Choice

A country reports that its actual real GDP is greater than its potential GDP.It must be that


A) an error was made when calculating actual real GDP.
B) the price level is increasing.
C) more workers decided to quit work in order to enjoy leisure time.
D) the excess by which real GDP exceeds potential GDP is only temporary,and eventually real GDP will decrease to be equal to potential GDP.
E) None of the above answers is correct because it is impossible for a country's real GDP to exceed its potential GDP.

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