If nominal GDP is $10 trillion and real GDP is $8 trillion, the GDP deflator is: a. 80, and this indicates that the price level has decreased by 20 percent since the base year.
If nominal GDP is $10 trillion and real GDP is $8 trillion, the GDP deflator is: a. 80, and this indicates that the price level has decreased by 20 percent since the base year.
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter8: Economic Fluctuations, Unemployment, And Inflation
Section: Chapter Questions
Problem 14CQ
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![If nominal GDP is $10 trillion and real GDP is $8
trillion, the GDP deflator is:
a. 80, and this indicates that the price level has
decreased by 20 percent since the base year.
b. 80, and this indicates that the price level has
increased by 80 percent since the base year.
c. 125, and this indicates that the price level has
increased by 25 percent since the base year.
d. 125, and this indicates that the price level has
increased by 125 percent since the base year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd80e374f-418f-4843-9a84-5fc593dab54a%2F4b69b27b-fe7f-45bd-8860-9e54036bffa2%2Fuabp58_processed.jpeg&w=3840&q=75)
Transcribed Image Text:If nominal GDP is $10 trillion and real GDP is $8
trillion, the GDP deflator is:
a. 80, and this indicates that the price level has
decreased by 20 percent since the base year.
b. 80, and this indicates that the price level has
increased by 80 percent since the base year.
c. 125, and this indicates that the price level has
increased by 25 percent since the base year.
d. 125, and this indicates that the price level has
increased by 125 percent since the base year.
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