Table 10-3
the Table Below Reports Nominal and Real GDP

question 209

Multiple Choice

Table 10-3
The table below reports nominal and real GDP for the U.S. from 1929 to 1932. $$\begin{array} { c c c } \hline \text { Year } & \begin{array} { c } \text { Nominal } \\\text { GDP }\end{array} & \text { Real GDP } \\\hline 1929 & 103.6 & 977 \\1930 & 91.2 & 892.8 \\1931 & 76.5 & 834.9 \\1932 & 58.7 & 725.8 \\\hline\end{array}$$
-Refer to Table 10-3. What is the GDP deflator and the inflation rate for 1932?

• A)8.09, -11.7
• B)8.09.16, -13.3
• C)1236.46, 11.7
• D)1236.46, 13.3

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Definitions:

Risk Free Asset

An investment that is expected to return its original value without any loss and with a certain rate of interest; considered to have zero default risk.

Rate of Return

The increase or decrease in the value of an investment during a set time frame, represented as a proportion of the investment's original price.

Level of Risk

The degree of uncertainty associated with an investment or decision, often regarding the potential for loss.

Optimal Portfolio

An investment strategy that maximizes expected return for a given level of risk through diversification.