If Nominal GDP Increased from $4,500 Billion in 2010 to $5,000

question 78

Multiple Choice

If nominal GDP increased from $4,500 billion in 2010 to $5,000 billion in 2011 and the GDP deflator increased from 100 to 105 over the same time period, what would the 2011 real GDP equal expressed in terms of 2010 dollars?

• A)​$4,285 billion
• B)​$4,500 billion
• C)​$4,725 billion
• D)​$4,762 billion

---

Definitions:

Cash Payback Period

The time frame it takes for an investment to generate an amount of cash flow to recover its initial cost.

Straight-Line Depreciation

A method of calculating the depreciation of an asset where the cost is evenly allocated over its useful life.

Useful Life

The estimated period over which an asset is expected to be usable by the entity, affecting its depreciation calculations.

Average Rate of Return

This refers to the percentage of average annual profit compared to the initial investment cost, commonly used to evaluate the profitability of an investment.