Assume the Inflation Rate in 2020 Is 2

question 27

Multiple Choice

Assume the inflation rate in 2020 is 2.1%. If the nominal GDP grew 4.6% and nominal wages grew 2.4%, what are the approximate real growth rates of GDP and wages?

• A)2.0%; .8%
• B)2.0%; .9%
• C)2.2%; .3%
• D)2.5%; .3%
• E)2.5%; .6%

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Definitions:

Billion

A numerical value equal to 1,000 million in the short scale and 1,000,000 million in the long scale.

Depreciates In Value

The process by which an asset loses value over time.

French Champagne

French Champagne is a sparkling wine made from specific grape varieties grown in the Champagne region of France, adhering to strict production rules.

Balance Of Payments

A record of all economic transactions between the residents of a country and the rest of the world in a period.