When the economy is at its potential output level,which of the following is true?

A) The price level is higher than that expected by workers.
B) The nominal wage is equal to the real wage.
C) The unemployment rate is about 14 percent.
D) The economy is producing its maximum sustainable output.
E) The actual price level is less than the expected price level.

Potential Output

Represents the highest level of real Gross Domestic Product (GDP) that can be sustained over the long term without increasing the rate of inflation.

Sustainable Output

The level of production that can be maintained over the long term without depleting natural resources or harming the environment.

Unemployment Rate

The fraction of the employment sector that is not employed and is earnestly looking for work.