Consider a simple economy that produces two goods: plastic cups and donuts. The following table shows the prices and quantities of the goods over athree-year period.Plastic cupsDonutsPriceQuantityPriceQuantityYear(Dollars per plastic cup) (Number of plastic cups)(Dollars per donut) (Number of donuts)20182215315520194.1353210202021503190Use the information from the preceding table to fill in the following table.Nominal GDP(Dollars)Real GDP(Base year 2018, dollars) GDP DeflatorYear201820192020From 2019 to 2020, nominal GDPand real GDPThe inflation rate in 2020 was 201941353210202021503190Use the information from the preceding table to fill in the following table.Nominal GDP(Dollars)Real GDP(Base year 2018, dollars) GDP DeflatorYear201820192020From 2019 to 2020, nominal GDPand real GDPThe inflation rate in 2020 wasWhy is real GDP a more accurate measure of an economy's production than nominal GDP?O Real GDP includes the value of exports, but nominal GDP does not.Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not.Real GDP is not influenced by price changes, but nominal GDP is.

To fill in the table for nominal GDP, real GDP, and the GDP deflator, we need to follow these…

Answered: Consider a simple economy that produces…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Consider a simple economy that produces two goods: plastic cups and paper plates. The following table shows the prices and quantities of the goods over a three-year period. Price Plastic cups Quantity Price Paper plates Quantity (Dollars per plastic cup) (Number of plastic cups) (Dollars per paper plate) (Number of paper plates) Year 2018 2 2019 3 2020 2 255 165 130 Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP (Base year 2018, dollars) GDP Deflator Year (Dollars) 2018 900 2019 1,065 2020 845 From 2019 to 2020, nominal GDP and real GDP The inflation rate in 2020 was 2 3 3 Why is real GDP a more accurate measure of an economy's production than nominal GDP? Real GDP does not include the value of intermediate goods and services, but nominal GDP does. Real GDP is not influenced by price changes, but nominal GDP is. ◇ Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not. 195 190 195
Q1 An economy produces two goods: hot dogs and burgers. In 2014, 15 hot dogs are produced at a price of $2 each, and 20 burgers at a price of $7 each. In 2015, 20 hot dogs are produced at a price of $4 each, and 30 burgers at a price of $8 each. Find the following: Nominal GDPs
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4. GDP vs Real GDP Consider a simple economy that produces two goods: cupcakes and oranges. The following table shows the prices and quantities of the goods over a three-year period. Cupcakes Oranges Price Quantity Price Quantity Year (Dollars per cupcake) (Number of cupcakes) (Dollars per orange) (Number of oranges) 2008 1 120 190 2009 160 4 200 2010 130 4 195 Use the information from the previous table to fill in the following table. GDP Real GDP Year (Dollars) (Base year 2008, dollars) 2008 2009 2010 From 2009 to 2010, GDP and real GDP Why is real GDP a more accurate measure of an economy's production than GDP? Real GDP includes the value of exports, but GDP does not. Real GDP does not include the value of intermediate goods and services, but GDP does. Real GDP is not influenced by price changes, but GDP is. 2. 3.
Suppose an economy consists of only three goods, as shown in this Table: What is the nominal value of GDP in 2020 and 2021?
Consider a simple economy that produces two goods: pencils and oranges. The following table shows the prices and quantities of the goods over a three-year period. Pencils Oranges Price Price Quantity Quantity (Dollars per pencil) (Number of pencils) (Dollars per orange) (Number of oranges) Year 2016 125 1 200 2017 2 170 230 2018 4 150 4 170 Use the information from the preceding table to fill in the following table. Real GDP Nominal GDP (Dollars) (Base year 2016, dollars) GDP Deflator Year 2016 2017 2018 From 2017 to 2018, nominal GDP , and real GDP The inflation rate in 2018 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? 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 does not include the value of intermediate goods and services, but nominal GDP does. Real GDP is not influenced by price changes, but nominal GDP is.
Consider a simple economy that produces two goods: beers and donuts. The following table shows the prices and quantities of the goods over a three-year period. Beers Donuts Price Quantity Price Quantity (Dollars per beer) (Number of beers) (Dollars per donut) (Number of donuts) 2 245 2 180 4 130 2 195 2 115 2 155 Use the information from the preceding table to fill in the following table. Year Nominal GDP Real GDP (Base Year 2016, dollars) GDP Deflator (Dollars) 2016 2017 2018 From 2017 to 2018, nominal GDP ________________, and real GDP __________ . The inflation rate in 2018 was ___________.
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Consider a simple economy that produces two goods: apples and envelopes. The following table shows the prices and quantities of the goods over a three-year period. Year Apples Envelopes Price Quantity Price Quantity (Dollars per apple) (Number of apples) (Dollars per envelope) (Number of envelopes) 2016 2 115 5 175 2017 4 150 2 180 2018 1 100 2 160 Use the information from the preceding table to fill in the following table. Year Nominal GDP (Dollars) Real GDP (Base year 2016, dollars) GDP Deflator 2016 2017 2018 From 2017 to 2018, nominal GDP: (a. increased, b. decreased), and real GDP (a. increased, b. decreased) . The inflation rate in 2018 was: (a. -47.5%, b. -0.5%, c. 47.5%, d. 52.5%, e. 190.5%) . Why is real GDP a more accurate measure of an economy's production than nominal GDP? a. Real GDP includes the value of exports, but nominal GDP does not.…
Consider a simple economy that produces two goods: pencils and erasers. The following table shows the prices and quantities of the goods over a three-year period. Year Pencils Erasers Price Quantity Price Quantity (Dollars per pencil) (Number of pencils) (Dollars per eraser) (Number of erasers) 2015 1 140 2 200 2016 2 125 4 220 2017 3 120 4 180 Use the information from the preceding table to fill in the following table. Year Nominal GDP Real GDP GDP Deflator (Dollars) (Base year 2015, dollars) 2015 2016 2017 From 2016 to 2017, nominal GDP_____, and real GDP_____. The inflation rate in 2017 was_____%. Why is real GDP a more accurate measure of an economy's production than nominal GDP? a) Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not. b) Real GDP is not influenced by price changes, but nominal GDP…
The table below presents a brief summary of City A’s total spending, local GDP, and population changes. Read the table and answer the following questions. 2010 2020 Total spending ($ million) 89 104.12 Local GDP ($ millions) 110 134 Population 50,000 56,275 CPI deflators (2012=1) 0.96 1.05 Calculate % change for City A’s total spending from 2010 to 2020 in current dollars. *Results round to the nearest 2 decimal places. Calculate % change for City A’s total spending from 2010 to 2020 in constant dollars. *Results round to the nearest 2 decimal places. Why does % change calculated from constant dollars differ from % change calculated from current dollar? Calculate per capita spending in 2010 and 2020, respectively, using constant dollars. *Results round to the nearest dollar. 2010 per capita spending: 2020 per capita spending: Calculate the compound annual growth rate of per capita spending from 2010 to 2020…
Suppose the output and prices in an economy are given as follows: Output of Year Price of Output of medical Price of medical computers computers care care 2020 10 $100 60 $200 2021 11 $50 70 $400 What is the value of nominal GDP in 2021? (Do not include $ or commas in your answer.) What is the value of real GDP in 2021, measured in base year 2020 prices? What is the value of real GDP in 2020, measured in base year 2021 prices? (Do not include $ or commas in your answer.)

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