If real GDP increases we know for sure that
A)output has risen.
B)prices have risen.
C)prices have risen but output has remained constant.
D)prices have remained constant.

Question

Quizplus · Accepted Answer

Real GDP measures the value of goods and services produced in an economy adjusted for the effects of inflation. An increase in real GDP indicates that output (i.e. the quantity of goods and services produced) has risen, while prices may have either remained constant or increased at a slower rate than output. Therefore, the correct answer is A.

If Real GDP Increases We Know for Sure That