Consider an economy that produces bread and cars. In the table 2.1 below are data for the different years:Table 2.1 Year 2008Year 2018Price of a loaf of bread$10$20Number of loaves of bread500,000400,000Price of a car$50,000$60,000Number of cars produced100120 Using the year 2008 as the base year, compute the following for each year:i.Nominal GDP ii.Real GDP iiiHow much have prices risen between year 2008 and 2018?

i) Nominal GDP for Each YearConcept of Nominal GDP: Nominal GDP measures the value of all final…

Answered: Consider an economy that produces bread…

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter7: Macroeconomic Measurements, Part Ii: Gdp And Real Gdp

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Table 2.1
	Year 2008	Year 2018
Price of a loaf of bread	$10	$20
Number of loaves of bread	500,000	400,000
Price of a car	$50,000	$60,000
Number of cars produced	100	120

	Using the year 2008 as the base year, compute the following for each year:
i.	Nominal GDP
ii.	Real GDP
iii	How much have prices risen between year 2008 and 2018?