Which statement about nominal and real GDP is incorrect?
A) Real GDP per person is a better measure of standard of living than nominal GDP per person.
B) Nominal GDP includes products and services produced within a country's borders, no matter what the nationality of the business doing the producing.
C) Real GDP is measured as a flow.
D) Nominal GDP is measured as a flow.
E) If nominal GDP is higher this year than last year, there must be positive economic growth.

Question

Quizplus · Accepted Answer

Nominal GDP can increase due to inflation, so a higher nominal GDP does not necessarily indicate positive economic growth.

Which Statement About Nominal and Real GDP Is Incorrect