If Prices Have Decreased Since the Base Period, Then

question 53

Multiple Choice

If prices have decreased since the base period, then

• A) there is no way to adjust nominal GDP so that it equals real GDP.
• B) real GDP is smaller than nominal GDP.
• C) real GDP is larger than nominal GDP.
• D) real GDP is equal to nominal GDP.
• E) real GDP can no longer be compared to nominal GDP.

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Definitions:

Weber's Law

A principle in psychology that states the change required to notice a difference between two stimuli is proportional to the original intensity of the stimulus.

Sensory Adaptation

This refers to the reduction in sensitivity to a stimulus after constant exposure to it.

Sleep Deprivation

A condition resulting from not getting enough sleep, which can affect mental, physical, and emotional health.

Neutral Object

An object that initially produces no specific response until it is associated with a meaningful stimulus through classical conditioning.