Please help me with these two questions The unit for the short-run component of output, Ỹ₁, is:a representative basket of goods and servicesUS dollars of 2010there is no unitcurrent US dollars Macroeconomic models of the short run focus on the departure ofcurrent GDP from its potential level, Y ₺. This departure is definedas:YtYt-Y tYtYt-Y tYtYt +Yt2

Part-1) The short-run fluctuations of actual output around potential output measure the stage of the business cycle such as economic contractions and expansions. The nominal interest rate will be equal to the real interest rate plus the inflation rate.The short run component (Y ̃) associated with economic fluctuations. There exists a positive relationship between the change in the rate of inflation and short run output (Y ̃). It indicates that when output is above potential, Y ̃ positive and the change in inflation will also be positive Thus option-d will be correct.Option-a will be incorrect. Consumer Price Index (CPI) determines the change over time in the prices paid by the buyers for a representative basket of products and services. Option-b will be incorrect. Option-c will be incorrect. The current U.S. dollars will be the unit for Y ̃Part-2) The difference among the actual output and potential output will be an output gap, and it is expressed as a percentage of potential output. It is calculated as: (Actual output - Potential output) / Potential output * 100 (or) Y ̃ = (Yt - Ȳt) / Ȳt where Y ̃means short-run output; Yt as current output; and Ȳt as potential output Thus option-c will be the correct answer Option-a will be incorrect. The gap will be calculated as (Actual output - Potential output) / Potential output * 100 Option-b will be incorrect. The potential output will be taken in the denominator Option-d will be incorrect. The difference between actual output and potential output will be described as percentage of potential output