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4 June, 17:23

Q7. Which of the following is a necessary condition - something that must occur-for nominal GDP to rise? Explain your answers.

Actual production must increase.

The price level must increase

Real GDP must increase

Both the price level and actual production must increase.

Either the price level or real GDP must increase.

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Answers (1)
  1. 4 June, 18:30
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    Either the price level or real GDP must increase

    Explanation:

    Gross Domestic Product (GDP) is used to measure the economic growth, purchasing power, and overall economic health of a country. nominal Gross Domestic Product, measures the value of all final goods and services produced within a country's borders at current market prices. It takes change in prices and interest rates, inflation and money supply into account when calculating a country's gross domestic product. Real GDP takes nominal GDP and adjusts for inflation or deflation by comparing and converting prices to a base year's prices. For nominal GDP to rise there must be increase on either the price level or real GDP.
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