Comparing two countries' nominal GDP over time is likely to be misleading if one wants to determine whether standards of living are better in one country because
A) the figures must be adjusted for different types of currency.
B) the figures must be adjusted for price changes and population differences.
C) the figures must be adjusted to account for production differences.
D) NDP instead of GDP should be used.

Question

Quizplus · Accepted Answer

Nominal GDP only takes into account the total value of goods and services produced in a country without adjusting for price changes or population differences. Therefore, it is not a reliable measure of standards of living. Adjusting for these factors using real GDP or GDP per capita would provide a more accurate comparison. The other options do not accurately address the issue of comparing standards of living between two countries.

Comparing Two Countries' Nominal GDP Over Time Is Likely to Be