Suppose that nominal GDP is $1,000 in 2009 and $1,500 in 2010. If the overall price level increased by _____% between 2009 and 2010, we could say that real GDP _____.
A) 50; stayed constant
B) less than 50; decreased
C) more than 50; increased
D) 50; increased

Question

Quizplus · Accepted Answer

Nominal GDP increased from $1,000 to $1,500, a 50% increase. If real GDP stayed constant, it means the entire increase in nominal GDP is due to the increase in the price level, also by 50%.

Suppose That Nominal GDP Is $1,000 in 2009 and $1,500