The difference between nominal and real values is that real values take into account
A) depreciation.
B) changes in the composition of output.
C) changes in prices between years.
D) the presence of durable goods.

Question

Quizplus · Accepted Answer

Nominal values reflect the actual price or quantity of something at a specific point in time, while real values adjust for changes in the general price level over time. Real values take into account the impact of inflation or deflation on the purchasing power of a unit of currency, and therefore, changes in prices between years. Conversely, nominal values do not account for changes in the general price level and reflect only the current price or quantity of something. Therefore, the correct choice is C.

The Difference Between Nominal and Real Values Is That Real