In an article, Scott Wolla of the Federal Reserve Bank of St. Louis writes that potential GDP doesn’t mean “that the the entire working-age population is working 18 hours per day or that factories are operating 24/7.”

a. What is the key difference between the (incorrect) definition of potential GDP that Wolla mentions and the correct definition?

b. Wolla also notes that “although rare, it’s possible for actual output to be higher than potential output.” Briefly explain how actual GDP can be greater than the potential GDP.