- CFA Exams
- CFA Level I Exam
- Study Session 17. Portfolio Management (2)
- Reading 46. Economics and Investment Markets
- Subject 3. The Yield Curve and the Business Cycle
CFA Practice Question
Negative output gaps are usually associated with ______.
A. high unemployment
B. an overheating economy
C. high inflation
Explanation: A negative output gap occurs when actual output is less than what an economy could produce at full capacity. It means that there is spare capacity, or slack, in the economy due to weak demand.
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