If all prices double and the quantities of every good stay the same, then

real GDP doubles and nominal GDP is unchangedCorrect answerYour answerboth nominal and real GDP doubleCorrect answerYour answernominal GDP doubles and real GDP is unchangedCorrect answerYour answerboth are unchangedCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer C

Correct answer: C

Nominal GDP = current prices × quantities, so it doubles.
Real GDP uses base prices, and quantities are the same, so it does not change.

Concept: Prices and the two GDPs
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsReal and nominal GDP

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If all prices double and the quantities of every good stay the same, then

Explanation