The 'GDP Deflator' Is a Measure of the Price Level

question 85

Multiple Choice

The 'GDP deflator' is a measure of the price level and is calculated by dividing ________ by ________ and multiplying by 100.

• A)real GDP; nominal GDP
• B)real GDP; the price level
• C)nominal GDP; real GDP
• D)the price level; nominal GDP

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Definitions:

Explicit Costs

Direct, out-of-pocket payments for expenses such as wages, rent, and materials, which are easily quantifiable.

Accountants

Professionals who manage financial records, conduct audits, and ensure tax compliance, playing a pivotal role in financial planning and analysis.

Accounting Profit

The difference between total monetary revenue and total monetary costs, and is calculated by subtracting explicit costs from total revenue.

Interest Rate

The percentage of a loan amount charged to the borrower or paid to an investor, serving as the cost of borrowing or the return on investment.