Output gap is emerging
I don’t understand the word “emerging” and the answer of Q9B Exam 2016.
What’s is the meaning of “output gap is emerging”?
from the answer Q9B, “A decline in inflation is typically associated with an output gap. “, output gap means “positive output gap” here?(because I know if the economy is slowdown, inflation declines and output gap become positive). My understanding is correct?
So, by convention, if output gap is negative, we consider there is no output gap?
What’s the meaning of the word emerging in this context?
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