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Assume US GDP is $20 trillion (this is about right), there is no output gap (it is $0), and that real GDP is growing 2%

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Assume US GDP is $20 trillion (this is about right), there is no output gap (it is $0), and that real GDP is growing 2% and potential for trend GDP) is growing 2.5% After 10 years, what will be the value of the output gap? Please remember that you have to consider compound growth rates. If you have $1 today, in 10 years growing at 10% results in a value of $2.59 which equals $1 (1.10) 10. O About $500 billion About $1.2 trillion About $0.1 trillion About $1.5 trillion About $10 trillion About $0.5 trillion

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