An article on cnbc.com in early 2019 noted that some stock market investors had a late-cycle psychology
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An article on cnbc.com in early 2019 noted that some stock market investors had a “‘late-cycle’ psychology that says time and productive capacity are running low for this expansion.”
a. What measure do economists use for the productive capacity of the economy?
b. What were these investors assuming about the relationship between real GDP and potential GDP in early 2019?
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a Measure for the Productive Capacity of the Economy Economists typically use the concept of Potential GDP to measure the productive capacity of the e...View the full answer
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