The correct option.
Answer to Problem 1QQ
Option ‘b’ is the correct answer.
Explanation of Solution
Option (b):
The nominal
Option (a):
The nominal GDP measures the economic output in a particular time period, so it is a flow variable (a variable that measures with the reference of time period), not a stock variable (a variable that measurable at a point of time). Thus, option (a) is incorrect.
Option (c):
The value of the economy’s output measured at current price in a particular time period is called nominal GDP. Thus, option (c) is incorrect.
Option (d):
Nominal GDP measures the economic output at current price in a particular time period. Usually, it is for one year not based on a particular point of time. Thus, option (d) is incorrect.
Nominal GDP (Gross Domestic Product): Nominal GDP measures the value of economy’s total output in a particular time period.
Flow variable: A flow variable is a variable that can be measured with reference to a period of time.
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