1. The inflationary gap is a) The difference between the RPI and the CPI b) The excess of spending of over income at full employment c) The difference between actual income and trend income 2. A negative output gap occurs when a) actual income is greater than trend income b) actual income is below trend income c) actual income is below potential output 3. Cost push inflation can occur when a) there is an appreciation of sterling b) UK VAT rates fall c) Oil prices rise on international markets

1. The inflationary gap is a) The difference between the RPI and the CPI b) The excess of spending of over income at full employment c) The difference between actual income and trend income 2. A negative output gap occurs when a) actual income is greater than trend income b) actual income is below trend income c) actual income is below potential output 3. Cost push inflation can occur when a) there is an appreciation of sterling b) UK VAT rates fall c) Oil prices rise on international markets

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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