Does this only describe actual color, or can it also be used to describe a gray moral situation as in English?
Ασπρόμαυρο is used to describe the actual color. For the moral situation you would say "Δεν είναι άσπρο-μαύρο".
would "This is neither black nor white" also be an acceptable translation?
I think not. Ασπρόμαυρο means that it has both white and black. If it's only black or only white, it's not ασπρόμαυρο but the "neither black nor white" does not apply. So you can say: το αυτοκίνητό μου δεν είναι ασπρόμαυρο! Είναι άσπρο!=my car is not black 'n white! It's (only) white!
That's a hard call. While the meaning comes through I'm wondering if it doesn't stretch the translation a bit. As we are trying to teach the Greek phrase. Let me ask around.
Can the word ασπρομαυρο mean clear as in the English "it is in black and white"?
No, it refers to the colors. It could be films, photos or anything that had those two colors.
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