Nominal GDP grew by 4%, and the growth rate of real GDP was 2.5%. What was the rate of inflation?
A)1.5%
B)4%
C)2.5%
D)6.5%

Name: Nominal GDP grew by 4%, and the growth rate of real GDP was 2.5%. What was the rate of inflation? A)1.5% B)4% C)2.5% D)6.5%
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Question

Quizplus · Accepted Answer

To calculate the inflation rate, we subtract the real GDP growth rate from the nominal GDP growth rate. Therefore, the inflation rate is 4% - 2.5% = 1.5%.

Nominal GDP Grew by 4%, and the Growth Rate of Real