Full employment, keeping inflation under control, and economic growth are among the major macroeconomic goals of all societies. Why is economic growth a major macroeco- nomic goal? What is potential output and how is it related to the target rate of unemployment and the target level of capacity utilization? Which is greater: potential or actual output during a recession? During an economic boom? What are some of the problems with the interpretation of unemployment statistics that can cause unemployment statistics to underes- timate and to overestimate the true rate of unemployment? How do Classical and Keynesian economists differ in this regard?