5. Real versus nominal GDPConsider a simple economy that produces two goods: cupcakes and envelopes. The following table shows the prices and quantities of the goods over athree-year period.CupcakesEnvelopesPriceQuantityPriceQuantityYear (Dollars per cupcake) (Number of cupcakes) (Dollars per envelope) (Number of envelopes)20171110185201815520020193110165Use the information from the preceding table to fill in the folowing table.Nominal GDPReal GDP(Dollars)(Base year 2017, dollars) GDP DeflatorYear201720182019From 2018 to 2019, nominal GDPand real GDPThe inflation rate in 2019 wasWhy is real GDP a more accurate measure of an economy's production than nominal GDP?Real GDP is not influenced by price changes, but nominal GDP is.Real GDP measures the value of the goods and services an economy produces, but nominal GDP measures the value of the goods andservices an economy consumes.O Real GDP includes the value of exports, but nominal GDP does not.

Nominal GDP vs Real GDP Considering that GDP is one of the most important metrics for assessing an…

5. Real versus nominal GDP Consider a simple economy that produces two goods: cupcakes and envelopes. The following table shows the prices and quantities of the goods over a three-year period. Cupcakes Envelopes Price Quantity Price Quantity Year (Dollars per cupcake) (Number of cupcakes) (Dollars per envelope) (Number of envelopes) 2017 1 110 2 185 2018 2 155 200 2019 3. 110 165 Use the information from the preceding table to fill in the folowing table. Nominal GDP Real GDP (Base year 2017, dollars) GDP Deflator Year (Dollars) 2017 2018 2019 From 2018 to 2019, nominal GDP , and real GDP The inflation rate in 2019 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? Real GDP is not influenced by price changes, but nominal GDP is. O Real GDP measures the value of the goods and services an economy produces, but nominal GDP measures the value of the goods and services an economy consumes. Real GDP includes the value of exports, but nominal GDP does not.