If nominal GDP is constant,then the GDP deflator varies inversely with
A)The unemployment rate.
B)Real GDP.
C)COLAs.
D)The CPI.

Question

Quizplus · Accepted Answer

The GDP deflator is a measure of the level of prices of all new, domestically produced, final goods and services in an economy. If nominal GDP is constant, changes in the GDP deflator reflect inverse changes in real GDP, because nominal GDP is the product of real GDP and the GDP deflator.

If Nominal GDP Is Constant,then the GDP Deflator Varies Inversely