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![If prices rose by 3% and nominal output rose by 5%, real output:
b. Rose by 8%.
c. Fell by 2%
Rose by 2%.
od
d. Fell by 8%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd2dd81d9-0823-42a6-bd49-c62408f470c9%2Fa1989044-d57a-4596-8ee6-a07a2074ed73%2Fcfg7eh5_processed.jpeg&w=3840&q=75)
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- An increase in the nominal GDP by 5% can correspond to a A decrease of real GDP by 5% and an increase of prices by 10% b An increase of real GDP by 9% and an increase of prices by 4%. c An increase of real GDP by 6% and a decrease of prices by 1% d A decrease in real GDP by 2% and an increase of prices by 3%If the price level has been falling over time (i.e. deflation), and Nominal GDP has been increasing, then we would expect to see Real GDP... Growing at the same rate as Nominal GDP Not changing Growing slower than Nominal GDP Growing faster than Nominal GDPa. If nominal GDP rose, does that mean that production had to increase as well? Why or why not?An increase in nominal GDP means there must have been an increase in inputs. may have been due to an increase in the price level. means production must have increased. means production must have decreased.b. What about if real GDP increased?An increase in real GDP may have been due to an increase in the price level. means production must have increased because the price level is not held constant. means production must have decreased. means production must have increased because the price level is held constant.c. Why is it important to use real GDP when comparing changes over time?Changes in real GDP over time will accurately reflect changes in real production. should not be used. We should use changes in nominal GDP when analyzing changes over time. have a time lag, which helps us accurately predict business cycles. will include changes in the price level, which gives a complete picture.
- Explain it correctly I upvote.Show how much changes in real income (or Real GDP) for each following cases. A. Nominal income falls by 2 percent, and the price level falls by 10 percent. E decrease) % (increase, % (increase, B. Nominal income rises by 8 percent, and the price level rises by 4 percent. E decrease) C. Nominal income rises by 12 percent, and the price level rises by 15 percent. decrease) % (increase, D. Nominal income falls by 4 percent, and the price level rises by 6 percent. E. decrease) Which one provides the greatest increase in real income? (A, B, C, D )E Circle a correct answer! % (increase, Indicate (circle, highlight) who would be hurt by inflation from the choices in the box below. Fixed income receiver Debtor Creditor Savers Flexible-income receivers (Borrower) (Lender)Solve it now. Not in excel
- Last year, Jane spent all of her income to purchase 200 units of corn at $5 per unit. This year, she spent all of her income to purchase 180 units of corn at $6 per unit. a)Jane's nominal income and real income decreased this year. b)Jane's nominal income decreased this year, but her real income increased. c)Jane's nominal income and real income increased this year. d)Jane's nominal income increased this year, but her real income decreased.Nominal GDP in Nowhereland in 2018 and 2019 is as follows: Can you say that the production of goods and services in Nowhereland has increased between 2018 and 2019? Why or why not?Suppose that this year’s nominal GDP is $16 trillion. To account for the effects of inflation, we construct a price-level index in which an index value of 100 represents the price level 5 years ago. Using that index, we find that this year’s real GDP is $15 trillion. Given those numbers, we can conclude that the current value of the index is: a. Higher than 100. b. Lower than 100. c. Still 100.
- Suppose that there are only 2 goods in the economy, A and B. We have yearly data on prices (p) and quantities produced (q) for each good for the period 2009-2011. Year PA qA pB qB 2009 1 2 3 2010 2 2 4 2 2011 2 4 3 3 a) Compute the nominal GDP for each year. b) Compute the GDP deflator for each year using the 2010 as base-year. Compute the inflation rate. 3Suppose the base year is 2001. Looking at GDP data from the United States from 2001 to the present, what would be true of the relationship between nominal GOP and real GDP? OA. RGDP NGDP because prices are stable. OB. RGDP NGDP because pridas are falling OD. The relationship is uncertain without more information on prices.A decrease in real GDP at the same time that nominal GDP increases would be consistent with: None of the other optionsAn increase in the price levelA period of deflationA decrease in the GDP deflator
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