Assume an Economy That Makes Only One Product and That

question 44

Multiple Choice

Assume an economy that makes only one product and that year 3 is the base year.Output and price data for a five-year period are as follows.Answer the question on the basis of these data. $\begin{array}{c}\begin{array}{c}\\\underline{\text { Year }} \\1 \\2 \\3 \\4 \\5\end{array}\begin{array}{c}\text { Units of}\\\underline{\text { Output}}\\3 \\4 \\6 \\7 \\8\end{array}\begin{array}{c}\text { Price Per } \\\underline{\text { Unit } }\\ \$ 3 \\4 \\5 \\7 \\8\end{array}\end{array}$
Refer to the data.For the years shown,the growth of:

• A) real GDP has exceeded the growth of nominal GDP.
• B) nominal GDP accurately reflects changes in real output.
• C) nominal GDP overstates increases in real output.
• D) nominal GDP understates increases in real output.

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Definitions:

Aggression

Behavior intended to harm or intimidate another individual, whether through physical force, verbal assault, or psychological manipulation.

Displacement

A defense mechanism where the mind substitutes either a new aim or a new object for goals felt in their original form to be dangerous or unacceptable.

Adrenal Gland

A gland located above the kidneys that produces hormones such as adrenaline and cortisol, which are critical for the body's stress response.

Corticosteroids

A class of steroid hormones produced in the adrenal cortex or synthesized; used medicinally to reduce inflammation and affect the immune system.