4 of 54 of 5 Items
Question
In a given year, nominal GDP grew by approximately 4%
, while real GDP grew by only 2.3%
. This difference can be accounted for by the fact that _____.(1 point)
Responses
net exports were positive during the year
net exports were positive during the year
net exports were negative during the year
net exports were negative during the year
prices of goods and services increased during the year
prices of goods and services increased during the year
prices of goods and services decreased during the year
1 answer
The correct response is:
prices of goods and services increased during the year
This is because nominal GDP accounts for the total market value of all final goods and services produced in a country without adjusting for inflation, while real GDP adjusts for inflation. The difference in growth rates suggests that prices have risen, contributing to the higher nominal GDP growth compared to real GDP growth.
