If a country is experiencing inflation,the change in the nominal national product will
A)equal the change in the real national product.
B)overstate the inflation rate.
C)overstate the change in the real value of production.
D)understate the value of national income.
E)be negative and will be falling faster than the rate of inflation.

Question

Quizplus · Accepted Answer

Inflation causes an increase in prices, which means that nominal GDP (measured in current prices) will increase more than real GDP (measured in constant prices). Therefore, the change in nominal GDP will overstate the change in the real value of production.

If a Country Is Experiencing Inflation,the Change in the Nominal