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What is the factor by which initial change is magnified (multiplier = change in real GDP/initial change in spending)?
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- GDP by production = value of produced output - value of used input.
- If prices rise over time, then real GDP will beA.larger than nominal GDP in years after the base year.B.larger than nominal GDP in years before the base year.C.smaller than nominal GDP in the base year.D.smaller than nominal GDP in years before the base year.
- The extent to which real GDP responds to changes in the price level along the short-run aggregate supply curve is largely determined byA.the speed with which input prices adjust and people become more fully informed.B.the ability of firms to hire additional inputs, particularly workers.C.the ability of firms to use existing workers and capital more intensively.D.All of the above.E.B and C only.