If real gross domestic product (GDP)grew by 2 percent and the inflation rate was 2 percent,then nominal GDP grew by

Question

Quizplus · Accepted Answer

Nominal GDP is calculated by adding the current prices of goods and services produced. If the real GDP grew by 2 percent and inflation was 2 percent, then the current prices also increased by 2 percent. Therefore, nominal GDP grew by 4 percent (2% real GDP growth + 2% inflation).

If Real Gross Domestic Product (GDP)grew by 2 Percent and the Inflation