Macroeconomics: GDP, CPI, and Deflator Quiz

Flashcards covering key macroeconomic concepts including components of GDP, deflation indicated by CPI changes, and calculating real GDP using the GDP deflator.

Gross Domestic Product is equivalent to the sum of __________.

Consumer spending, investment spending, government purchases and net exports

If the Consumer Price Index changes from $100$ to $90$, economists will know that there was __________ in the economy.

deflation

If the nominal GDP in a given year is $\text{\$500 billion}$ and the GDP deflator for that year is $125$, the real GDP is __________.

$$\text{\$400 billion}$$