In 2015, Nominal GDP Was $250 and Real GDP Was

question 140

Multiple Choice

In 2015, nominal GDP was $250 and real GDP was $200. In 2016, nominal GDP was $360 and real GDP was $240. What is the growth rate of real GDP between 2015 and 2016?

• A) 60%
• B) 40%
• C) 25%
• D) 20%
• E) none of the above answers

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Definitions:

Net Cash Flows

The difference between cash inflows and outflows during a specific period, reflecting the company's financial health.

Internal Rate of Return

A financial metric used to evaluate the profitability of potential investments, calculating the discount rate at which the net present value of costs and benefits of an investment equals zero.

Capital Budgeting

The procedure of assessing and choosing long-term investment opportunities that align with the objective of maximizing shareholder wealth.

Net Present Value

A financial metric that calculates the value of a projected future cash flows relative to the initial investment, considering the time value of money.