During a presidential campaign, the incumbent argues that he should be reelected because nominal GDP grew by 12 percent during his 4-year term in office. You know that population grew by 4 percent over the period and that the GDP deflator increased by 6 percent during the past 4 years. You should conclude that real GDP per person

a. grew by 2%

b. grew by 6%

c. grew by 8%

d. grew by 12%

Question

Sloane Hall

Business

22 April, 15:03

During a presidential campaign, the incumbent argues that he should be reelected because nominal GDP grew by 12 percent during his 4-year term in office. You know that population grew by 4 percent over the period and that the GDP deflator increased by 6 percent during the past 4 years. You should conclude that real GDP per person

a. grew by 2%

b. grew by 6%

c. grew by 8%

d. grew by 12%

+4

Answers (1)

Know the Answer?

Eileen Mendez · Answer 1

The correct answer is "grew, but by less than 12%"

Explanation:

Since GDP grew by 12% but at the same time population also increase by 4% so the overall increase will be less than 12% to calculate the exact amount on percentage increase in GDP more data is needed.