If National Income Accountants Fail to Make an Adequate Adjustment

question 91

Multiple Choice

If national income accountants fail to make an adequate adjustment for increases in the quality of goods and services over time,

• A) real GDP will overstate the growth rate of real output.
• B) the GDP deflator will underestimate inflation.
• C) the GDP deflator will overestimate inflation.
• D) real GDP will overstate the growth of real output, and the GDP deflator will understate inflation.

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Definitions:

Fitness Benefit

Fitness benefits are advantages gained that increase an individual's reproductive success and chance of passing genes to the next generation.

Foraging Tactic

Strategies employed by animals to locate, capture, and consume food, which can vary widely among species based on ecological niches and food availability.

Optimal

The most favorable or desirable condition or outcome, especially from the standpoint of biology, where it often refers to the most efficient allocation of resources for survival and reproduction.

Fitness Payoff

The benefit gained in terms of reproductive success and survival by adopting a particular behavior or strategy.