MACROECONOMICS (LL)
21st Edition
ISBN: 9781260186949
Author: McConnell
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 7, Problem 8RQ
To determine
The change in GDP .
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Suppose that this year’s nominal GDP is $16 trillion. To account for the effects of inflation, we construct a price-level index in which an index value of 100 represents the price level 5 years ago. Using that index, we find that this year’s real GDP is $15 trillion. Given those numbers, we can conclude that the current value of the index is:
a. Higher than 100.
b. Lower than 100.
c. Still 100.
Suppose that for the United States, Nominal GDP is $18 trillion for 2016. Assume further that the price of a market basket in 2018 is $3,200 whereas the same market basket in the year 2000 fetched a price of $2,000. If the year 2000 is the base year, what is Real GDP in 2016 (rounded to the nearest trillion)?
A) $40.9
B)$28.8
C)$11.25
D)$7
An economy has nominal GDP of $16,768 billion in year 1 and $17,419 billion in year 2. If real GDP is $15,710 billion in 2019 and $16,086 billion in year 2, by how much did the price level rise between year 1 and year 2? Give your answer in percentage terms, not decimals. Round your answer to two deciman place
Chapter 7 Solutions
MACROECONOMICS (LL)
Ch. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 11DQCh. 7 - Prob. 12DQCh. 7 - Prob. 13DQCh. 7 - Prob. 14DQCh. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQCh. 7 - Prob. 1PCh. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 5PCh. 7 - Prob. 6PCh. 7 - Prob. 7PCh. 7 - Prob. 8P
Knowledge Booster
Similar questions
- Nominal GDP in Nowhereland in 2018 and 2019 is as follows: Can you say that the production of goods and services in Nowhereland has increased between 2018 and 2019? Why or why not?arrow_forwardShow your work for the following questions.if nominal output rises from$240billion to $259 billion,and the GDP deflator rises from 100to105. a) what is the percentage increase in nominal output? b) what is the percentage increase in the price index? c) By how much does real output change? d) To what value would the deflator have had to rise for real income to remain constant? Please kindly answer all these questionsarrow_forwardWhat is the level of nominal GDP in France this year? FRED tells you that the real GDP is chained in a specific year (this means that it is evaluated in terms of constant prices for that year). Note that the real GDP and the nominal GDP series cross at one point. Why does this happen? ANSWER FROM THE GARPH.arrow_forward
- If the price level has been falling over time (i.e. deflation), and Nominal GDP has been increasing, then we would expect to see Real GDP... Growing at the same rate as Nominal GDP Not changing Growing slower than Nominal GDP Growing faster than Nominal GDParrow_forwardConsider an economy that produces 4 goods. Unless otherwise stated, 2017 is the base year. Quantity Price Product 2017 2018 2017 2018 A 5 7 $30 $40 B 6 4 $20 $40 C 8 12 $15 $20 D 3 5 $100 $110 1. Calculate nominal and real GDP for 2017 and 2018. What is the GDP deflator in 2017 and 2018? What is the corresponding annual growth rate of the economy and the annual inflation rate? ***This has been answered*** Real GDP is the value of goods and services produced in an economy in an year, taken at base year prices Nominal GDP is the value of goods and services produced in an economy in an year taken at current year prices GDP deflator is given by formula: (Nominal GDP/Real GDP)*100 annual growth rate of economy is given by formula: current GDP minus the pervious year GDP divided by the previous year GDP Inflation is calculated as the current GDP deflator - previous GDP deflator whole divided by the previous…arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...EconomicsISBN:9781337091985Author:N. Gregory MankiwPublisher:Cengage Learning
Essentials of Economics (MindTap Course List)EconomicsISBN:9781337091992Author:N. Gregory MankiwPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...
Economics
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning