ssume that the total output of goods and services is held constant and the price level increases. Which of the following observations concerning Gross Domestic Product (GDP) is TRUE? a)  Nominal GDP rises, real GDP falls. b)  Nominal GDP falls, real GDP rises. c)  Nominal GDP rises, real GDP stays the same. d)  Nominal GDP stays the same, real GDP rises

Q: How is U.S. total expenditure on goods and services in a year calculated?   U.S. total expenditure…

A: The expenditure method is the most widely used approach for calculating Gross Domestic Product,…

Q: Consider an economy that produces only chocolate bars. In year 1, the quantity produced is 10 bars…

A: In economics, the final demand domestically can be defined as the total demand for final services…

Q: Suppose that annual output in year 1 in a 3-good economy is 3 quarts of ice cream, 1 bottle of…

A: 1.The nominal GDP of the year can be calculated by multiplying the price of a commodity with its…

Q: Classify each of the following items as a final good or service or an intermediate good or service…

A: The gross domestic product(GDP) refers to the market value of all the final commodities produced…

Q: Suppose nominal GDP increased in a given year. Based on this information, we know with certainty…

A: Introduction This is MCQ question from GDP topic

Q: Refer to the graph, a shift from AS3 to AS2 might be caused by an increase in: AS3 AS, AS2 Real…

A: The relationship between the price level and the output potential of a commodity/firm is measured…

Q: Suppose nominal GDP increased in a given year. Based on this information, we know with certainty…

A: Nominal GDP means GDP produced for the current goods and services produced without the adjustment of…

Q: q25- Real GDP is: Select one: a. the production of goods and services valued at future-year prices…

A: Real GDP refers to the final value of goods and services produced in an economy during a year which…

Q: Assume an economy where there are two producers: a wheat producer and a bread producer. In a given…

A: Product and Expenditure approaches are two approaches used to measure GDP. Product approach is the…

Q: Gross domestic product measures the total expenditure on the economy’s input of goods and services.…

A: GDP is the term that measures the value of goods and services that are produced within a country's…

Q: (Nominal GDP) Which of the following is a necessary condition —something that must occur—for nominal…

A: Nominal GDP (NGDP) = Real GDP (RGDP) x Price level (P) So, % Change in NGDP = % Change in RGDP + %…

Q: 20. If both the production of goods and services increase and prices rise, then the change in…

A: Answer: option d Explanation: If the production of goods and services increases and the prices rise…

Q: Suppose that the residents of Windhoek spend all of their income on cauliflower, broccoli and…

A: Since you have posted a question with multiple sub-parts, we will solve first three sub parts for…

Q: Assume that nominal income increases by 5% and the price level increases by 3%, which of the…

A: Nominal income does not take into account inflation.

Q: Last year, Jane spent all of her income to purchase 200 units of corn at $5 per unit. This year, she…

A: Nominal income does not take prices into account. It is not adjusted for inflation. Real income is…

Q: Use the concepts of gross investment and net investment to distinguish between an economy that has a…

A: In the computation of the GDP, the main components that are evaluated are the personal consumption…

Q: Refer to the information provided in Table Table Production Prices Year 1 Year 2 50 Year 3 Year 1…

A: Given the 1st year price of good x = $1 The 1st year price of good y = $0.60

Q: Describe the role of business inventory change in determining the equilibrium level of GDP and…

A: The level of GDP can be calculated based on the business inventory. When there is no change in the…

Q: What happens to disposable personal income if tax rates increased? How could nominal GDP increase…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: Which statement best describes the difference between Nominal and Real GDP? Group of answer choices…

A: Nominal GDP measures the value of goods and services at current market prices. Real GDP measures the…

Q: Country X produces only apples and bananas. The following table shows prices and quantities of both…

A: Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: Suppose the CPI increased by 5 percent over each of the last 5 years while the GDP price index…

A: If CPI increased considerably,used goods or consumer goods prices increased to a greater extent…

Q: Suppose nominal GDP in 2013 increased by 8% (over its previous level in 2012). Given this…

A: Gross domestic product refers to the total market value of goods and services produced domestically…

Q: Which of these is not a characteristic of the gross domestic product? a. Includes intermediate goods…

A: GDP is one of the most important indicators for measuring the economic activity, stability, and…

Q: Discuss and explain the impact of each transaction below on the calculation of the gross domestic…

A: The gross domestic product refers to the market value of all the final commodities(goods and…

Q: (i) Explain the difference between Gross Domestic Product (GDP) and Gross National Income. (ii)…

A: i)The entire amount of all the money earned by a nation's population and enterprises is known as…

Q: Consider the following data assuming that these are the only products produced and consumed in the…

A: Real GDP measure the value of all the final goods and services that are produced during a given year…

Q: What is the difference between gross private domestic investment and net private domestic…

A: Domestic investment measures the total investment that the firms or the business invest in projects…

Q: Q.18 If the quantity of each of the goods and services produced in an economy decreases from 2010 to…

A: Given: The quantity of each of the goods and services produced in an economy decreases from 2010 to…

Q: One way in which economists measure the performance of an economy is by looking at a widely used…

A: In general terms economic performance usually tells or describe the overall achievement of the…

Q: Suppose an economy produces only 2 products that will also be used for direct consumption, as per…

A: GDP: GDP refers to the gross domestic product of an economy. The more GDP of an economy at the end…

Q: Suppose that annual output in year 1 in a 3-good economy is 3 quarts of ice cream, 1 bottle of…

A: Nominal GDP measures a country's gross domestic product using current prices, without adjusting for…

Q: 1.Real GDP is a more perfect measure of an economy's production than nominal GDP. Explain 2.…

A: Economists are the people who make theories and models on economic behavior using presumptions, past…

Q: What is the relationship of the GDP deflator to real GDP? To make comparisons across time or across…

A: GDP Deflator The potential production of goods and services is referred to as GDP. However, the…

Q: Which one of these will be deducted from gross output to determine the net output? a. Intermediate…

A: Net output method is also known as value added method. It is used to measure value added by each…

Q: Suppose an economy has only two sectors: Goods and Services. Each year, Goods sells 75% of its…

A: Let the price of the total annual output of the good be Pg Let the price of the total annual output…

Q: The nominal GDP of the U.S. in 2019 was approximately $21.4 trillion. This means that The value of…

A: In nominal GDP, the gross domestic product (GDP) is calculated using current market prices. GDP is…

Q: Which definition best describes real GDP? a)the production of goods and services valued at current…

A: The Gross Domestic Product is the summation of the money value of all the final goods and services…