If nominal GDP increases by 5 percent a year and the GDP price index rises by 2 percent a​ year, then real GDP increases by​ _______. A. 2.5 percent a year   B. 3 percent a year   C. 7 percent a year   D. 10 percent a year

Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter7: Taking The Nation's Economic Pulse
Section: Chapter Questions
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If nominal GDP increases by 5 percent a year and the GDP price index rises by 2 percent a​ year, then real GDP increases by​ _______.

A.
2.5 percent a year
 
B.
3 percent a year
 
C.
7 percent a year
 
D.
10 percent a year
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