Real GDP will increase
A)only when prices increase.
B)only when output increases.
C)when prices increase or output increases.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

Real GDP is a measure of the economic output of a country, therefore it only increases when the quantity of goods and services produced increases (output). It's important to note that real GDP is adjusted for changes in prices (inflation or deflation), so price increases alone do not necessarily increase real GDP.

Real GDP Will Increase