If real GDP increased by 3 percent,then
A)real output has increased by 3 percent
B)the price level has increased by 3 percent
C)consumer spending increased by 3 percent
D)government spending increased by 3 percent
E)the increase might have been caused by an increase in the price level,but we cannot tell for sure

Question

Quizplus · Accepted Answer

Real GDP measures the total value of goods and services produced in an economy, adjusted for changes in prices. Therefore, an increase in real GDP by 3 percent means that real output has also increased by 3 percent, holding prices constant. It does not necessarily mean that the price level has increased or that consumer or government spending has changed.

If Real GDP Increased by 3 Percent,then