Suppose that nominal GDP did not change in 2011, and real GDP decreased, relative to the year 2010. It can be concluded that:
A)total production of goods and services in the economy did not change in 2011.
B)the economy experienced deflation during 2011.
C)the price level did not change during 2011.
D)total production of goods and services in the economy declined during 2011.

Question

Suppose that nominal GDP did not change in 2011, and real GDP decreased, relative to the year 2010. It can be concluded that:
A)​total production of goods and services in the economy did not change in 2011.
B)​the economy experienced deflation during 2011.
C)​the price level did not change during 2011.
D)​total production of goods and services in the economy declined during 2011.

Quizplus · Accepted Answer

If nominal GDP did not change but real GDP decreased, it means that there was a decline in the production of goods and services in the economy. This could have occurred due to various factors, such as a decrease in consumer spending or a decrease in investment. It does not necessarily mean that there was deflation or no change in the price level, as these are not directly related to changes in real GDP.

Suppose That Nominal GDP Did Not Change in 2011, and Real