During the business cycle,
A) real GDP fluctuates around nominal GDP.
B) nominal GDP fluctuates around real GDP.
C) real GDP fluctuates around its trend.
D) trend GDP fluctuates around real GDP.
E) real GDP falls after the trough.
Question 2
Resource use is allocatively efficient when
A) we produce the goods with the highest opportunity cost.
B) we produce the goods with the lowest opportunity cost.
C) we cannot produce more goods and services.
D) we produce the amount of the different goods we value most highly.
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