Suppose That the Nominal Value of GDP Increased by Approximately

question 122

Multiple Choice

Suppose that the nominal value of GDP increased by approximately 2 percent during a given year, but real GDP decreased by 3 percent. Which of the following best explains these events?

• A) The money supply decreased by approximately 5 percent.
• B) Prices fell by approximately 5 percent.
• C) Prices increased by approximately 5 percent.
• D) The real productive capacity of the economy increased by approximately 5 percent.

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Definitions:

Freelancer

An individual who works as an independent contractor to provide services to multiple clients, often operating their own small business.

Free Agent

A professional who operates independently, often contracting their services to different organizations rather than being permanently employed by one.

Multiple Employers

Engaging multiple employers refers to a work arrangement where an individual simultaneously holds employment positions with more than one employer, often to diversify income sources or gain varied work experiences.

Flextime

Flexible working hours in which employees customize their own work hours within limits established by management.