For every 1% increase in unemployment, there is a 2%

decrease in potential GDP. This

creates a GDP gap. What is the GDP

gap when there is 4.5%

unemployment?

The GDP gap is 9 % when there is 4.5 % unemployment.

Step-by-step explanation:

The statement shows a reverse relationship, where an increase in unemployment is following by decrease in potential GDP and can be translated into the following rate:

The GDP gap at a given increase in unemployment can be estimated by the following expression:

Where:

- GDP gap-unemployment increase rate, dimensionless.

- Increase in unemployment rate, measured in percentage.

- GDP gap, measured in percentage.

If and , the GDP gap is:

The GDP gap is 9 % when there is 4.5 % unemployment.

location: point 0

step-by-step explanation:

well, -8 to 10 on a number line is 18 spaces.

1/9 of 18 is 2.

so, 4/9 of 18 must be 8.

8 spaces from -8 (a) is 0.

so, 4/9 of the way from -8 to 10 is 0!