Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 30 - Part X - Money Growth and Inflation - Problems and Applications - Page 656: 3

Answer

Nominal variables: Variables measured in monetary units Real Variables: Variables measured in physical units. According to the monetary neutrality, the change in money supply only will affect nominal variables.

Work Step by Step

Nominal variables examples: People wages or income. Nominal GDP Real variables examples: Real GDP, quantity of goods produced
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