If real GDP falls when nominal GDP increases, then prices have fallen.

Name: If real GDP falls when nominal GDP increases, then prices have fallen.
Brand: Quizplus
Rating: 4.9 (40 reviews)

Question

Quizplus · Accepted Answer

If real GDP falls while nominal GDP increases, it means that there has been an increase in prices. Real GDP is adjusted for inflation, while nominal GDP is not. Therefore, if real GDP is decreasing while nominal GDP is increasing, it implies that prices have risen.

If Real GDP Falls When Nominal GDP Increases, Then Prices