Use tne inrormation trom tne preceaing tabie to nii in tne roliowing tabie.Nominal GDPReal GDPYear(Dollars)(Base year 2016, dollars)GDP Deflator201620172018From 2017 to 2018, nominal GDPand real GDPThe Inflation rate in 2018 wasWhy is real GDP a more accurate measure of an economy's production than nominal GDP?O Real GDP Is not influenced by price changes, but nominal GDP is.O Real GDP does not include the value of intermediate goods and services, but nominal GDP does.Real GDP includes the value of exports, but nominal GDP does not. 1. Real versus nominal GDpConsider a simple economy that produces two goods: cupcakes and muffins. The following table shows the prices and quantities of the goods over athree-year period.CupcakesMuffinsPriceQuantityPriceQuantityYear(Dollars per cupcake) (Number of cupcakes) (Dollars per muffin)(Number of muffins)201612019520171301952018130145

Nominal GDP is the sum of product of current year quantity and current year price. Real GDP is the…

1. Real versus nominal GDP Consider a simple economy that produces two goods: cupcakes and muffins. The following table shows the prices and quantities of the goods over a three-year period. Cupcakes Muffins Price Quantity Price Quantity (Dollars per cupcake) (Number of cupcakes) (Dollars per mutfin) (Number of muffins) Year 2016 120 195 2017 130 195 2018 130 145