Asked by Andrews Osei antwi on Apr 26, 2024
Verified
Which statement is true?
A) GDP and real GDP are equal only in the base year.
B) Real GDP is always greater than GDP.
C) GDP is always greater than real GDP.
D) GDP and real GDP are never equal.
Real GDP
The total value of all goods and services produced in a country in a year, adjusted for inflation or deflation.
Base Year
A specific year against which economic growth or other economic indicators are measured, serving as a comparison point.
GDP
Gross Domestic Product (GDP) measures the total value of all goods and services produced over a specific time period within a country's borders.
- Master the basic concepts of GDP and real GDP, along with an understanding of how to compute and interpret these economic indicators.
- Comprehend the importance of the GDP deflator and its function in converting nominal GDP into real GDP.
Verified Answer
HN
Heather NeubeckerApr 30, 2024
Final Answer :
A
Explanation :
GDP and real GDP are equal only in the base year because in other years, real GDP adjusts for inflation while GDP does not.
Learning Objectives
- Master the basic concepts of GDP and real GDP, along with an understanding of how to compute and interpret these economic indicators.
- Comprehend the importance of the GDP deflator and its function in converting nominal GDP into real GDP.