An increase in nominal GDP means that there has been an outward shift of the production possibilities curve.

Question

Quizplus · Accepted Answer

Nominal GDP only measures the total output of goods and services in a given economy at current market prices. It does not take into account changes in productivity or technology, and therefore cannot affect the production possibilities curve. Only changes in factors of production, such as capital or labor, can shift the curve outward.

An Increase in Nominal GDP Means That There Has Been