Within the aggregate demand/aggregate supply framework, the quantity produced and purchased in the goods and services market represents
A) nominal output or nominal GDP.
B) the interest rate.
C) real output or real GDP.
D) the consumer price index.

Question

Quizplus · Accepted Answer

The quantity produced and purchased in the goods and services market represents real output or real GDP, as it takes into account changes in the price level through the use of a price index, such as the GDP deflator. Neither nominal output/GDP (A), interest rate (B), nor the consumer price index (D) specifically reflect the quantity produced and purchased in the goods and services market.

Within the Aggregate Demand/aggregate Supply Framework, the Quantity Produced and Purchased