In comparing GDP data over a period of years, a difference between nominal and real GDP may arise because
A) of changes in trade deﬁcits and surpluses.
B) the length of the workweek has declined historically.
C) the price level may change over time.
D) depreciation may be greater or smaller than gross investment.

Question

Quizplus · Accepted Answer

Nominal GDP is simply the value of a country's output in current market prices, while real GDP adjusts for changes in the price level over time. Therefore, a difference between nominal and real GDP may arise because the price level may change over time.

In Comparing GDP Data Over a Period of Years, a Difference