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The Table Below Shows the Price Indexes and the Nominal

question 83

Multiple Choice

The table below shows the price indexes and the nominal gross domestic product (GDP) for an economy from 2001 to 2005. The real GDP _____ between 2002 and 2003. The table below shows the price indexes and the nominal gross domestic product (GDP)  for an economy from 2001 to 2005. The real GDP _____ between 2002 and 2003.   A)  decreased by slightly more than $5 billion B)  increased by slightly more than $4 billion C)  remained constant D)  increased by only about $1 billion E)  decreased by $6 billion


Definitions:

Coupon

The annual interest rate paid by a bond, expressed as a percentage of the face value, or the actual amount paid out to a bondholder annually.

Inflation

The rate at which there's an upward movement in the general price level of goods and services, weakening the purchasing capacity.

Convexity

A measure of the curvature or the degree of the curve in the relationship between bond prices and bond yields, indicating how the duration of a bond changes as the interest rate changes.

Bond Price Curve

A graphical representation of the relationship between the price of bonds and their respective maturities.

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