Nominal GDP Will Always Equal Real GDP

question 69

Multiple Choice

Nominal GDP will always equal real GDP:

• A)​if prices are declining.
• B)​in the base year.
• C)​if prices are increasing.
• D)​if the economy's total production does not change.

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Definitions:

Midpoint Method

is a technique in economics used to calculate the elasticity of demand or supply, providing a more accurate measure by averaging the starting and ending points.

Elasticity of Demand

A measure of how sensitive the demand for a good or service is to changes in its price.

Quantity Demanded

The complete amount of a product or service that purchasers have the willingness and capacity to obtain at a set price.

Price Inelastic

A situation where the quantity demanded or supplied of a good is not significantly affected by changes in price.