Economics (Book Only)
12th Edition
ISBN: 9781285738321
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 7, Problem 4WNG
To determine
Estimate the value of Real
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In year 1 and year 2, there are two products produced in a given economy: computers and bread. Suppose that there are no intermediate goods. In year 1, 20 computers are produced and sold at $1600 each, and in year 2,
28 computers are produced and sold at $2880 each. In year 1, 20,000 loaves of bread are sold for $4 each, and in year 2, 26,000 loaves of bread are sold for $4.40 each.
a. Nominal GDP in year 1 is $ and nominal GDP in year 2 is $ . (Round your responses to the nearest integer as needed.)
b. Calculate real GDP in each year and the percentage increase in real GDP from year 1 to year 2 by using year 1 as the base year. Next, do the same calculations by using the chain-weighting method.
Using year 1 as the base year, real GDP in year 1 is $,
real GDP in year 2 is $
and the percentage increase in real GDP from year 1 to year 2 is %. (Round responses for real GDP to the nearest integer as needed,
and round your response for the percentage increase to three decimal places as…
In year 1 and year 2, there are two products produced in a given economy, computers and bread. Suppose that there are no intermediate goods. In year 1, 20 computers are produced and sold at $1,000 each, and in year 2, 25 computers are sold at $1,500 each. In year 1, 10,000 loaves of bread are sold for $1.00 each, and in year 2, 12,000 loaves of bread are sold for $1.10 each.
(a) Calculate nominal GDP in each year.
(b) Calculate real GDP in each year, and the percentage increase in real GDP from year 1 to year 2 using year 1 as the base year. Next, do the same calculations using the chain-weighting method.
(c) Calculate the implicit GDP price deflator and the percentage inflation rate from year 1 to year 2 using year 1 as the base year. Next, do the same calculations using the chain-weighting method.
Assume an economy in which only apple and orange are produced. In year 1, 200 million killograms of apple are produced and consumed and its price is
$0.6 per kilogram, while 150 million killograms of orange are produced and consumed and its price is $0.7 per killogram. In year 2, 250 million kilograms of
apple are produced and consumed and its price is $0.7 per kilogram, while 300 million kilograms of orange are prduced and its price is $0.8 per kilogram.
(Show the results upto 1 decimal point when required)
(a) If the base year is year 1 then the GDP price deflator in year 2 is
(b) If the base year is year 2 then the GDP price deflator in year 1 is
(c) If the base year is year 1 then the inflation rate between years 1 and 2 is
(d) If the base year is year 2 then the inflation rate between years 1 and 2 is
(e) The chain weighted inflation rate between year 1 and year 2 is %
(f) If the base year is year 1 then CPI inflation rate is %
%
%
Chapter 7 Solutions
Economics (Book Only)
Ch. 7.1 - Prob. 1STCh. 7.1 - Prob. 2STCh. 7.2 - Prob. 1STCh. 7.2 - Prob. 2STCh. 7.2 - Prob. 3STCh. 7.4 - Prob. 1STCh. 7.4 - Prob. 2STCh. 7.4 - Prob. 3STCh. 7 - Prob. 1VQPCh. 7 - Prob. 2VQP
Ch. 7 - Prob. 3VQPCh. 7 - Prob. 4VQPCh. 7 - Prob. 5VQPCh. 7 - Prob. 1QPCh. 7 - Prob. 2QPCh. 7 - Prob. 3QPCh. 7 - Prob. 4QPCh. 7 - Prob. 5QPCh. 7 - Prob. 6QPCh. 7 - Prob. 7QPCh. 7 - Prob. 8QPCh. 7 - Prob. 9QPCh. 7 - Prob. 10QPCh. 7 - Prob. 11QPCh. 7 - Prob. 1WNGCh. 7 - Prob. 2WNGCh. 7 - Prob. 3WNGCh. 7 - Prob. 4WNGCh. 7 - Prob. 5WNGCh. 7 - Prob. 6WNGCh. 7 - Prob. 7WNGCh. 7 - Prob. 8WNG
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