Suppose the real gross domestic product (GDP) equals $100 billion this year and the nominal gross domestic product (GDP) is $200 billion.This implies that the price level has increased by _____.

A) $200 billion
B) 50 percent
C) $100 billion
D) 100 percent
E) 200 percent

Real Gross Domestic Product

A measure adjusted for inflation that shows the value of all products and services produced within an economy in a specific year.

Nominal Gross Domestic Product

The market value of all final goods and services produced within a country in a year, measured using current prices without adjustment for inflation.

Price Level

The average of current prices across the entire spectrum of goods and services produced in the economy, a measure of inflation or deflation.