GDP gap
"The economic cost of unemployment is measured by the GDP gap." Explain this statement. ?
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The GDP gap refers to the gap between current GDP and the GDP that corresponds to full employment level. The latter is also called the ‘potential GDP’. When there is unemployment the economy is unable to produce at potential level and the shortfall is the cost that the economy pays in economic terms. This is the cost in economic terms as it is the ’economy’s’ loss. There are other costs of unemployment, but they are personal and restricted to the unemployed person and his family.
Implication of Fiscal deficit A) It raise the supply of money in the economyB) It rises financial burden for future generation.C) It is the cause of inflation.
Between 1961 and 2007, the rising share of the Canadian population in paid employment contributed to rising GDP per person. But suppose that the share of the Canadian population in paid employment had remained constant between 1961 and 2007. What would Canadian GDP pe
In poor countries people spend a big percentage of their income so that APC and MPC are high. Yet, the value of multiplier is low. Explain why?
Does full employment take place if AD = AS or S = I?
Describe cost-push inflation and its major source.
Elucidate the basis of categorizing government receipts into revenue receipts and capital receipts. Answer: Revenue Receipts: The government revenue receipts are such receipts A) that neither makes liability
If $9 is required to buy £2, what is the exchange rate for USA dollar? Answer: £1 = 9/2 = $4.5, i.e., £1 = $4.5.
The Financial Account captures international fund flows due to
What are the strength and weakness of using per capital national income? give explained answer for query
Illustrate a point on consumption curve at which APC = 1. Answer: APC = C/Y = 1 is possible when C = Y, that is, Consumption is
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