Asked by Travis Entwisle on Jun 24, 2024
Verified
If GDP increases,then real GDP
A) may have either increased or decreased.
B) has increased.
C) has decreased.
D) is unchangeD.
Real GDP
Gross Domestic Product adjusted for inflation, providing a more accurate measure of an economy's size and growth rate over time.
- Demarcate real from nominal GDP and understand the ramifications of inflation and deflation on them.
Verified Answer
SS
Sharanpreet SinghJun 30, 2024
Final Answer :
A
Explanation :
GDP (Gross Domestic Product) can increase due to a rise in production (real GDP increase) or due to an increase in prices (inflation). Real GDP adjusts for inflation, so if the increase in GDP is solely due to inflation, real GDP may not increase. Therefore, real GDP may have either increased or decreased when nominal GDP increases.
Learning Objectives
- Demarcate real from nominal GDP and understand the ramifications of inflation and deflation on them.