If Nominal GDP Is $12 Trillion and Real GDP Is

question 41

Multiple Choice

If nominal GDP is $12 trillion and real GDP is $10 trillion,then the GDP deflator is

• A)83.33,and this indicates that the price level has decreased by 16.67 percent since the base year.
• B)83.33,and this indicates that the price level has increased by 83.33 percent since the base year.
• C)120,and this indicates that the price level has increased by 20 percent since the base year.
• D)120,and this indicates that the price level has increased by 120 percent since the base year.

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Definitions:

Lowest Terms

A fraction that cannot be reduced by any common divisor.

Fractions

Number expressions of one or more equal parts of whole units.

Improper Fractions

Improper fractions are fractions where the numerator (the top number) is greater than or equal to the denominator (the bottom number), representing a value equal to or greater than one.

Mixed Numbers

A number consisting of an integer and a proper fraction.