Q28. If real GDP is greater than potential GDP then

a.the unemployment rate is at the natural rate and price levels are lowering.

b.the unemployment rate is high and price levels are stable.

c.the unemployment rate is low and prices levels are rising.

Q29. With the economy at full employment, consumers and firms become more optimistic about the future economy and

a.output will rise.

b.price levels will fall.

c.unemployment will rise.

Q30. A fall in foreign prices relative to the price level in the U.S. will cause:

a.U.S. net exports to rise.

b.U.S. net exports to fall.

c.U.S. aggregate demand to fall.