GDP Can Increase from One Year to the Next By

question 22

Multiple Choice

GDP can increase from one year to the next by:

• A)increases in prices while quantities of goods and services are constant.
• B)increases in the quantities of goods and services produced while prices remain constant.
• C)both prices and quantities of goods and services increase.
• D)all of the above.

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Definitions:

Elastic Demand

A situation where the quantity demanded of a good or service significantly changes in response to a change in its price.

Total Budget

The overall amount of money allocated for a specific purpose or period.

Large Part

A phrase indicating a significant portion or majority of a whole.

Elastic Demand

A situation where the quantity demanded of a product changes significantly in response to a change in price.