Which of the Following Equations Correctly Links the Growth Rate

question 38

Multiple Choice

Which of the following equations correctly links the growth rate of real GDP,the growth rate of nominal GDP,and the inflation rate?

• A) Growth rate of real GDP = Growth rate of nominal GDP + Inflation rate.
• B) Growth rate of real GDP + Growth rate of nominal GDP = Inflation rate.
• C) Growth rate of real GDP - Growth rate of nominal GDP = Inflation rate.
• D) Growth rate of real GDP = Growth rate of nominal GDP - Inflation rate.

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Definitions:

Inverse Demand Function

A mathematical function that expresses the price of a good as a function of the quantity demanded.

Inverse Supply

A concept that illustrates how the quantity of goods supplied by producers decreases as the price decreases, typically represented by an upward sloping curve in economics.

Tax

A compulsory financial charge or other levy imposed upon a taxpayer by a governmental organization in order to fund various public expenditures.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers at various prices.