If You Attempted to Determine If the Standard of Living

question 134

Multiple Choice

If you attempted to determine if the standard of living of a country has increased by looking only at changes in its nominal gross domestic product (GDP) ,what would you be missing?

• A) the fact that nominal GDP includes all economic activity,including sales of used goods and illegal goods
• B) the fact that nominal GDP only considers changes in the price level but ignores changes in population
• C) the fact that an increase in nominal GDP normally means that standards of living are falling,not rising
• D) the fact that,in the long run,nominal GDP is the best measure of overall economic growth
• E) the fact that an increase in nominal GDP does not necessarily mean that standards of living are rising,due to changes in prices and the population

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