If Nominal GDP in 2009 Equals $14 Trillion and Real

question 35

Multiple Choice

If nominal GDP in 2009 equals $14 trillion and real GDP in 2009 equals $11 trillion, what is the value of the GDP deflator?

• A)0.79
• B)1.03
• C)1.27
• D)1.30

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Definitions:

Discount

A reduction in the price of a good or service, typically to encourage purchase.

Cash Interest

The actual amount of interest paid in cash by a borrower during a given period for the use of borrowed funds.

Interest Expense

The cost incurred by an entity for borrowed funds, reflecting the interest payments due on any type of debt for a specific period.