Solved

The Drawback to Calculating Real GDP Using Base-Year Prices Is

Question 197

Multiple Choice

The drawback to calculating real GDP using base-year prices is that


A) real GDP in one year is not comparable to real GDP in another year.
B) relative prices change over time, which is not reflected in base-year prices, and this distorts GDP.
C) relative prices change over time and these changes are reflected in base-year prices.
D) quality changes are reflected in base-year prices.
E) base year prices do not capture changes in production from year to year.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q174: If the GDP deflator is less than

Q192: Table 4.15 Table 4.15 </p></div><svg width=

Q194: If prices rise on average in the

Q195: Table 4.17 Table 4.17 </p></div><svg width=

Q196: The GDP deflator in year 2 is

Q199: The measure of production that values output

Q200: If real GDP is larger than nominal

Q201: If nominal GDP rises, we can say

Q202: Nominal GDP is another term for
A)inflation-adjusted GDP.
B)real

Q213: In the term "real GDP," what does

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents