Question

If a country experiences a rise in prices but produces the same quantity of output as in the previous year, its nominal GDP will _____ and its real GDP will _____.

Answer 1

Increases

Stays the same

Step-by-step explanation:

Nominal GDP is output produced by a country multiplied by current year prices.

Real GDP is output produced by a country multiplied by base year prices. The real GDP adjusts for the effects of inflation.

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