Answer the question on the basis of the following information: year nominal GDP price index 1 550 140 2 560 135 3 576 125 4 586 117 5 604 108 In the economy above:
a) the price level is rising faster than nominal GDP.
b) nominal and real GDP are growing at the same rate.
c) the growth of nominal GDP understates the growth of real GDP.
d) the growth of nominal GDP overstates the growth of real GDP.
c) the growth of nominal GDP understates the growth of real GDP.
Economics
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If the interest rate on a security consists only of the riskless rate, then
A) there is no uncertainty. B) velocity is constant. C) the money supply is fixed. D) the price level is fixed.
Economics
The quantity of money demanded decreases at every combination of GDP and interest rate. If the Fed holds to an unchanged money supply target, the interest rate __________ and GDP __________
A) rises; rises B) rises; falls C) falls; rises D) falls; falls
Economics