When there is rapid inflation
A)growth in nominal GDP exceeds growth in real GDP.
B)there can never be any growth in nominal GDP.
C)government tries to increase growth in real GDP.
D)growth in real GDP exceeds growth in nominal GDP.
E)growth in real GDP and nominal GDP are roughly equal.

Question

Quizplus · Accepted Answer

When there is rapid inflation, the prices of goods and services increase rapidly, resulting in a rise in nominal GDP (GDP calculated at current, inflated prices). However, real GDP (GDP calculated at constant, non-inflated prices) may not keep up with the inflation rate, and thus the growth in nominal GDP may exceed the growth in real GDP.

When There Is Rapid Inflation