Table 23-5 The Country of Caspir Produces Only Cereal and Milk. Quantities

question 387

Multiple Choice

Table 23-5
The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2015.
Prices and Quantities
-Refer to Table 23-5. In 2015, this country's

• A)nominal GDP was greater than real GDP, and the GDP deflator was greater than 100.
• B)nominal GDP was equal to real GDP, and the GDP deflator was equal to 100%.
• C)nominal GDP was less than real GDP, and the GDP deflator was less than 100.
• D)nominal GDP was equal to real GDP, and the GDP deflator was equal to 100.

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs of a product or service, used to cover fixed costs and to generate profit.

Fixed Costs

Costs that do not change with the level of production or business activity, such as rent, salaries, and insurance premiums.

Full-Service Contract

An agreement that provides a complete range of services related to a specific product, property, or activity, including maintenance, repairs, and often replacements.

Profit

The financial gain achieved when the revenue from business activities exceeds the expenses, costs, and taxes involved in maintaining the operation.