If Nominal National Income Increased by 10% Over a Certain

question 69

Multiple Choice

If nominal national income increased by 10% over a certain period of time while real national income increased by 20%,then

• A)everybody in the economy became worse off.
• B)inflation has occurred during this time period.
• C)the labour force increased by 10%.
• D)the price level has declined by about 10%.
• E)the price level has increased by approximately 10%.

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Definitions:

Annual Rainfall

A meteorological measurement indicating the total amount of precipitation received over a year in a given area.

Drought

An extended period of deficient rainfall relative to the statistical multi-year average for a region, resulting in water scarcity.

Tar Content

The amount of tar, a toxic substance, that is produced and released by burning products, such as cigarettes.

Normally Distributed

A balanced probability distribution around the mean, underscoring that events happening close to the mean are more common than distant events.