Is it possible for nominal GDP to increase while real GDP does not change?
What will be an ideal response?
Yes, it is possible for nominal GDP to increase while real GDP does not change. Nominal GDP changes if either prices or production change, while real GDP changes only if production changes. If production does not change while the prices of the goods and services increase, real GDP does not change while nominal GDP increases.
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Suppose Molly has an income of $35,000 annually and has inherited a savings account of $20,000. Wyatt has a job that pays $35,000 annually, but has debts totaling $6,000. Which of the following is TRUE?
A) We can expect Wyatt and Molly to save the same proportion of their incomes this year. B) We can expect Molly to save more than Wyatt this year. C) We can expect Wyatt to save more than Molly this year. D) We can expect Wyatt and Molly to have equal amounts of consumption this year.
Indifference curves that are closest to the origin are preferable to ones that are farther from the origin
a. True b. False Indicate whether the statement is true or false
Some cities finance their airports with a departure tax: every person leaving the city by plane is charged a small fixed dollar amount that is used to help pay for building and running the airport. The departure tax follows the:
a. benefits-received principle. b. ability-to-pay principle. c. flat-rate taxation principle. d. public-choice principle.
In the market for hardwood, everything else held constant, if the rate of interest increases:
a. the price of the hardwood will fall today. b. the lumberjacks will harvest fewer trees today. c. prices of boats and furniture will increase in the present period. d. the lumberjacks will harvest all the trees leaving nothing for the future. e. the price of the hardwood will fall in the future.