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If real GDP falls from one period to another, we can conclude thatNone of these necessarily occursnominal GDP fell.prices decreased.inflation occurred.

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Solution

The statement seems to be incomplete, but I'll try to answer based on what I understand.

Real GDP (Gross Domestic Product) is the economic output of a country with inflation taken into account, while nominal GDP is not adjusted for inflation.

If real GDP falls from one period to another, it doesn't necessarily mean that nominal GDP fell, prices decreased, or inflation occurred. Here's why:

  1. Nominal GDP could still rise if the prices of goods and services increase, even if the actual quantity of goods and services produced (real GDP) decreases.

  2. Prices could either increase, decrease, or stay the same when real GDP falls. It depends on various factors such as changes in supply and demand.

  3. Inflation is a general increase in prices and fall in the purchasing value of money. A fall in real GDP doesn't necessarily mean that inflation occurred. It could be due to a decrease in the production of goods and services.

So, none of these necessarily occurs if real GDP falls from one period to another.

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