Refer to Table below. A very simple economy produces two goods: cameras and legal services. The quantities produced and their corresponding prices for 2015 and 2019 are shown in the table.               2015             2019   Product Quantity Price Quantity Price Digital Camera            100            $10            120            $12 Legal services              50              15              45              20   Calculate the real GDP in 2019 using 2015 as a base year.

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Consider the following data for a hypothetical economy that produces two goods: milk and honey. Quantity Produced Prices Milk (litres) Honey (kg) Milk ($/litre) Honey ($/kg) Year 1 110 45 2 6 Year 2 125 40 37 Compute nominal GDP for each year in this economy. Using year 1 as the base year, compute real GDP for each year. What is the percentage change in real GDP from year 1 to year 2? Using year 1 as the base year, compute the price deflator for each year. Now compute the GDP deflator for each year, using year 2 as the base year. Explain why the measures of real GDP growth (and growth in the deflator) depend on the choice of base year.

2018 2022 2018 2022 Table 1: Prices and Quantities in 2018 and 2022 Quantity of Corns 10 20 Price of Corns RM 10 RM 12 Quantity of Corns 10 20 Quantity of Carrots Using data from Table 1 above and assuming that 2018 is the base year, find real GDP for the year 2022 and 2018. 15 30 Table 1: Prices and Quantities in 2018 and 2022 Using data from Table 1 above and assuming that 2018 is the base year, find real GDP for the year 2022 and 2018. Price of Corns RM 10 RM 12 Price of Carrots RM 5 RM 6 Quantity of Carrots 15 30 Price of Carrots RM 5 RM 6

Year Nominal GDP Real GDP 1 5,100 4,800 2 5,500 5,000 3 5,750 5,100     Refer to the table. GDP figures are in billions of dollars. What is the GDP price index in Year 3?   Multiple Choice   112.70   104.55   117.84