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WAEC Economics 2014 Question 31

Question 31

National Income

Which of the following will increase the nominal value of national income?

  1. A.High rate of inflation
  2. B.Increase in the value of money
  3. C.Increase in import
  4. D.High rate of subsistence production.
Show the answer and explanation

Answer: A (High rate of inflation)

Explanation

Nominal national income is measured at current prices, so rising prices raise it even without more output.