Assertion (A): A rise in nominal GDP does not always mean that more goods were produced.
Reason (R): Nominal GDP can rise only because prices rose, with output unchanged.

Both A and R are true, and R is the correct explanation of A.Correct answerYour answerBoth A and R are true, but R is not the correct explanation of A.Correct answerYour answerA is true, but R is false.Correct answerYour answerA is false, but R is true.Correct answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

Nominal GDP = prices × quantities, so it rises with either.
R explains A; real GDP removes the price effect.

Concept: Nominal versus real
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsReal and nominal GDP

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Assertion (A): A rise in nominal GDP does not always mean that more goods were produced.Reason (R): Nominal GDP can rise only because prices rose, with output unchanged.

Explanation

Assertion (A): A rise in nominal GDP does not always mean that more goods were produced.
Reason (R): Nominal GDP can rise only because prices rose, with output unchanged.