Assume the economy is in a recession and that the annual GDP growth rate is equa

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Assume the economy is in a recession and that the annual GDP growth rate is equal to 1%. As a result: Question 7 options: Aggregate supply will grow equal to supply side growth and aggregate demand will keep pace. Therefore the output gap will remain constant. Aggregate supply will grow equal to supply side growth and aggregate demand will decrease. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand growth will be positive but grow at a slower rate. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand will grow at a faster rate. Therefore the output gap will shrink. Assume the economy is in a recession and that the annual GDP growth rate is equal to 1%. As a result: Assume the economy is in a recession and that the annual GDP growth rate is equal to 1%. As a result: Aggregate supply will grow equal to supply side growth and aggregate demand will keep pace. Therefore the output gap will remain constant. Aggregate supply will grow equal to supply side growth and aggregate demand will decrease. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand growth will be positive but grow at a slower rate. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand will grow at a faster rate. Therefore the output gap will shrink. Aggregate supply will grow equal to supply side growth and aggregate demand will keep pace. Therefore the output gap will remain constant. Aggregate supply will grow equal to supply side growth and aggregate demand will decrease. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand growth will be positive but grow at a slower rate. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand will grow at a faster rate. Therefore the output gap will shrink. Aggregate supply will grow equal to supply side growth and aggregate demand will keep pace. Therefore the output gap will remain constant. Aggregate supply will grow equal to supply side growth and aggregate demand will decrease. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand growth will be positive but grow at a slower rate. Therefore the output gap will increase. Aggregate supply will grow equal to supply side growth and aggregate demand will grow at a faster rate. Therefore the output gap will shrink.

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