Which of the following statement is correct?
A) If nominal GDP does not change, then real GDP cannot change.
B) If nominal GDP decreases, then real GDP must increase.
C) Nominal and real GDP can change either in the same direction or the opposite direction.
D) If real GDP decreases, then nominal GDP must decrease.
E) If nominal GDP increases, then real GDP must increase.
C
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The efforts of nations to influence exchange rates are known as
A) open market operations. B) establishing terms of trade. C) foreign exchange market intervention. D) rate discrimination.
In a two-period model with production, a permanent increase in domestic government spending
A) increases domestic output and increases the current account surplus. B) increases domestic output and decreases the current account surplus. C) decreases domestic output and increases the current account surplus. D) decreases domestic output and decreases the current account surplus.