If we choose 2007 as a base year,then in 2007
A)nominal GDP will be greater than real GDP.
B)nominal GDP will be smaller than real GDP.
C)nominal GDP will be the same as real GDP.
D)we cannot compare nominal GDP and real GDP without having their actual values.

Question

Quizplus · Accepted Answer

When we use 2007 as the base year, real GDP is calculated by adjusting nominal GDP for inflation using the prices of goods and services in 2007. Therefore, nominal GDP and real GDP will be equal in 2007.

If We Choose 2007 as a Base Year,then in 2007