che average cost of living between 2008 and 200 the average

(c))he average cost of living between 2008 and 200 ( the average cost of living between 200S and 2009 went down (d) all of the above 2. When the economy is said to be at full employment it means that (a) total unemployment is zero (b) structural plus frictional unemployment are zero (c) cyclical unemployment is zero (eyelical unemployment is (d) cyclical unemployment is full 3. Potential GDP is (a) always equal to actual nominal G (b) always equal to actual real GDP X (o) equal to the amount of output that the economy could produce if all inputs were fully used (d) equal to the rate of unemploymen 4. Among the followings, the best indicator of economic well-being in the economy is probably (a) an increase of nominal GDP (b) an increase of real GDP (c) a decrease of unemployment rate d)an increase in real GDP per capita 5. Deflation

Solution

3.) Potential Gdp is that level of GDP of a country at which it is utilising all the available resources and inputs ;hence at full employment level.So correct option is ( c.)

6.) Nominal GDP growth=6.8%

Inflation rate=2.2%

Real GDP has been adjusted for inflation.So nominal GDP will be generally higher then Real GDP.

Real GDP growth =Nominal GDP-Inflation rate=6.8-2.2=4.6%

7.) CPI is weighted index of goods purchased by consumers.

New products represent another weakness in the CPI. Products do not become included in the CPI\'s basket of goods purchased until they become virtually staple purchases by consumers. So even though new products may be widely purchased and represent considerable consumer expenditures, they may still be years away from possible inclusion in the calculation of the CPI.Hence basket of goods is not updated frequently.

Hence correct option is b.