6. TheGDP gap and the consequences of unemployment On the following graph, the black line shows potential real GDP and the blue line shows actual real GDP for a hypothetical country from 1990 to 2010. Use the green quadrilateral (triangle symbols) to shade the area between actual and potential real GDP that represents the positive GDP gap. Then use the purple quadrilateral (diamond symbols) to shade the area between actual and potential real GDP that represents the negative GDP gap. (s 10 9 Positive GDP Gap (?)

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Which of the following are true of an economy operating below full employment? Check all that apply.
The economy has an unemployment rate higher than the natural rate of unemployment.
Actual real GDP is less than potential real GDP.
A teenage worker is more likely to be unemployed than an older worker.
A worker with a college degree is more likely to be unemployed than a worker without one.
Transcribed Image Text:Which of the following are true of an economy operating below full employment? Check all that apply. The economy has an unemployment rate higher than the natural rate of unemployment. Actual real GDP is less than potential real GDP. A teenage worker is more likely to be unemployed than an older worker. A worker with a college degree is more likely to be unemployed than a worker without one.
6. TheGDP gap and the consequences of unemployment
On the following graph, the black line shows potential real GDP and the blue line shows actual real GDP for a hypothetical country from 1990 to
2010.
Use the green quadrilateral (triangle symbols) to shade the area between actual and potential real GDP that represents the positive GDP gap.
Then use the purple quadrilateral (diamond symbols) to shade the area between actual and potential real GDP that represents the
negative GDP gap.
10
Actual Real GDP
Z
Potential Real GDP
GDP (Billions of 2000 dollars)
9
8
LO
A
2
1
0
1990
1994
1998
YEAR
2002
2006
2010
Positive GDP Gap
Negative GDP Gap
(?)
Transcribed Image Text:6. TheGDP gap and the consequences of unemployment On the following graph, the black line shows potential real GDP and the blue line shows actual real GDP for a hypothetical country from 1990 to 2010. Use the green quadrilateral (triangle symbols) to shade the area between actual and potential real GDP that represents the positive GDP gap. Then use the purple quadrilateral (diamond symbols) to shade the area between actual and potential real GDP that represents the negative GDP gap. 10 Actual Real GDP Z Potential Real GDP GDP (Billions of 2000 dollars) 9 8 LO A 2 1 0 1990 1994 1998 YEAR 2002 2006 2010 Positive GDP Gap Negative GDP Gap (?)
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