What Is the Result If the Size of the "Underground

question 150

Multiple Choice

What is the result if the size of the "underground economy" grows?

• A)Real GDP will rise more rapidly than nominal GDP.
• B)GDP will understate the level of economic activity.
• C)GDP will overstate the level of economic activity.
• D)Since GDP does not include the "underground economy",there will be no understatement or overstatement of economic activity.
• E)Since the "underground economy" is included in the reported GDP,there is no issue of inaccuracy.

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