If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be
A)equal to 100.
B)greater than 100.
C)less than 100.
D)less than 0.

Question

Quizplus · Accepted Answer

The GDP deflator measures the overall price level in the economy by comparing the nominal GDP to the real GDP. If nominal GDP exceeds real GDP, this means that prices have increased, and therefore the GDP deflator must be greater than 100.

If Nominal GDP Exceeds Real GDP for a Specific Year,then