The Difference Between Nominal Gross Domestic Product (GDP)and Real GDP

question 169

Multiple Choice

The difference between nominal gross domestic product (GDP) and real GDP is

• A) real output growth.
• B) the price level.
• C) nominal output growth.
• D) long-run trend GDP.
• E) average output growth.

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Definitions:

Multifactor APT

Multifactor Arbitrage Pricing Theory, a model that describes the relationship between risk and expected return with multiple factors.

Beta

An indicator of the level of fluctuation, or inherent risk, of an asset or collection of assets relative to the overall market.

Zero-Investment Portfolio

A portfolio of zero net value, established by buying and shorting component securities, usually in the context of an arbitrage strategy.

Positive Expected Return

A projection that an investment will yield a return above the initial outlay.