Consider a simple economy that produces two goods: pens and erasers. The following table shows the prices and quantities of the goods over a three- year period. Pens Erasers Price Quantity Price Quantity Year (Dollars per pen) (Number of pens) (Dollars per eraser) (Number of erasers) 2018 1 130 2 165 2019 2 140 205 2020 4 120 4 190 Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP Year (Dollars) (Base year 2018, dollars) GDP Deflator 2018 2019 2020 From 2019 to 2020, nominal GDP and real GDP The inflation rate in 2020 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? 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 is not influenced by price changes, but nominal GDP is. O Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not.

Consider a simple economy that produces two goods: pens and erasers. The following table shows the prices and quantities of the goods over a three- year period. Pens Erasers Price Quantity Price Quantity Year (Dollars per pen) (Number of pens) (Dollars per eraser) (Number of erasers) 2018 1 130 2 165 2019 2 140 205 2020 4 120 4 190 Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP Year (Dollars) (Base year 2018, dollars) GDP Deflator 2018 2019 2020 From 2019 to 2020, nominal GDP and real GDP The inflation rate in 2020 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? 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 is not influenced by price changes, but nominal GDP is. O Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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