ECONOMICS
ECONOMIC GROWTH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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True
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False
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Either A or B
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None of the above
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Detailed explanation-1: -If economic growth accelerates very rapidly, demand grows even faster and producers raise prices continually. Supply constraints can also drive prices higher absent any material change in demand. An upward price spiral, sometimes called “runaway inflation” or “hyperinflation, ” can result.
Detailed explanation-2: -The most common way to measure the economy is real gross domestic product, or real GDP. GDP is the total value of everything-goods and services-produced in our economy. The word “real” means that the total has been adjusted to remove the effects of inflation.
Detailed explanation-3: -Also known as “constant price GDP, ” “inflation-corrected GDP, ” or “constant dollar GDP, ” real GDP is derived by isolating and removing inflation from the equation by placing value at base-year prices, making GDP a more accurate reflection of a nation’s economic output.
Detailed explanation-4: -Real gross domestic product (GDP) is a measurement of economic output that accounts for the effects of inflation or deflation. It provides a more realistic assessment of growth than nominal GDP.