The classical model of macroeconomics assumes ?

A. wages and prices are sticky
B. wages and prices are flexible
C. the economy may operate below full capacity
D. the economy is always at full capacity
E. A and C
F. B and D

Potential GDP is the level of aggregate output ?

A. that can be produced if structural unemployment is zero
B. that can be produced at a zero-unemployment rate
C. that can be sustained in the long run without inflation
D. that can be sustained in the long run, if the inflation rate is zero

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