If We Knew That Nominal GDP Was Currently $5

question 75

Multiple Choice

If we knew that nominal GDP was currently $5.4 trillion,and that GDP in dollars of 1997 purchasing power was $3.6 trillion,what would we know about the GDP price index?

• A)It would be 0.667.
• B)It would be 150.
• C)We would know nothing until we had current information on the price level.
• D)We would know only that a dollar buys more currently than it bought in 1997.
• E)It indicates that substantial deflation has occurred since 1997.

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