MACROECONOMICS (LL) W/CONNECT
21st Edition
ISBN: 9781264197149
Author: McConnell
Publisher: MCG CUSTOM
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Question
Chapter 7, Problem 8RQ
To determine
The change in GDP .
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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.
The following table gives nominal and real GDP for an economy for two years.
Based on the table, in Year 2, the value of the GDP deflator is
Year 1
1430.0
1,300
Nominal GDP
Real GDP
(Round your answer to one decimal place.)
The inflation rate between Year 1 and Year 2 is %. (Round your answer to one decimal place.)
Year 2
1820.0
1560.0
The nominal GDP for 2021 is $125 billion, and the real GDP for 2021 is $100 billion.
(1). Calculate the GDP Deflator in 2021? Show your calculation.
(2). Also assume that the GDP deflator in 2020 was 100. What is the inflation rate over the 1-year period? Show yourcalculation.
Chapter 7 Solutions
MACROECONOMICS (LL) W/CONNECT
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
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