If Nominal GDP Is $10 Trillion and Real GDP Is

question 179

Multiple Choice

If nominal GDP is $10 trillion and real GDP is $8 trillion,the GDP deflator is

• A)80, and this indicates that the price level has decreased by 20 percent since the base year.
• B)80, and this indicates that the price level has increased by 80 percent since the base year.
• C)125, and this indicates that the price level has increased by 25 percent since the base year.
• D)125, and this indicates that the price level has increased by 125 percent since the base year.

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