If the GDP deflator is less than 100, which will be higher: nominal GDP or real GDP? Why?
What will be an ideal response?
Real GDP will be higher. The GDP deflator is the ratio of nominal GDP to real GDP, so if the value is less than 100, nominal GDP must be smaller than real GDP.
Economics
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Explain how inflation can be costly even if it is expected
What will be an ideal response?
Economics
Government expenditures as a percentage of GDP in the U.S. increased from 1950 to 1975 but decreased sharply during the recession that began in 2008
a. True b. False Indicate whether the statement is true or false
Economics