GDP Deflator = Nominal GDP/Real GDP x 100.
as long as a different sector of the economy contributes to GDP by more than was lost from unemployment, real GDP will rise, if only marginally.
Real GDP is a measure of the economic output of a country. The absolute measure only tells you what that output was for a particular period. The more important measure for employment is the difference between real GDP and a theoretical real GDP which economists use to calculate the maximum output of an economy. When the gap between real GDP and maximum output GDP is large, the unemployment rate will be large and vice versa.
Unemployment causes GDP to decrease. GDP means gross domestic product. If there are no employees to create a product, the GDP goes down.
real GDP inflation unemployment
Declines and unemployment rises.
the economy is operating at full employment. Note: full employment is not the same as zero unemployment.
A decline in real GDP and a high level of unemployment.
Assume certeris paribus, an expansionary gap is where real GDP is above the full employment, and a contractionary gap is where real GDP is below the full employment.
trough
How to calculate potential gdp and natyral rate of unemployment?
c. real GDP growth of about 4% annually