Asked by
anduamlak yalew
on Nov 11, 2024
Verified
An expansionary gap generally creates inflationary pressure in an economy.
Expansionary Gap
A situation where the actual output of an economy exceeds its potential output at full employment, often leading to inflation.
Inflationary Pressure
The upward pressure on prices that may arise from factors such as increased demand or rising costs, leading to inflation.
- Grasp the effects of expansionary and recessionary gaps on the economy.
Verified Answer
AG
Learning Objectives
- Grasp the effects of expansionary and recessionary gaps on the economy.
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