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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The effect of a change in price on the quantity bought while keeping the consumer on the same indifference curve, is called the
A) price effect. B) income effect. C) substitution effect. D) real effect.
Economics
An increase in the interest rate
A) decreases the opportunity cost of holding money. B) increases the opportunity cost of holding money. C) decreases the percentage yield of holding money. D) increases the percentage yield of holding money.
Economics