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Given the information in the table below, what is country A's real aggregate product in B$ at constant purchasing.power of year 2 for years 1, 2, and 3 respectively? Remember: step 1, make sure that the general price index has the correct base year; step 2, transform the nominal aggregat product in A$ into the real aggregate product in A$ using the correct general price index; and step 3, transform the real aggregate product in A$ into the real aggregate product in B$ using the correct exchange rate (and pay attention that exchanges rates are B$/A$, so you may need to use division or multiplication). Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency B$. B$2160 B$2592 "B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (BS/AS). 1.00 1.20 1.35 PPP exchange rate (BS/A$). 1.50 1.80 2.00

Given the information in the table below, what is country A's real aggregate product in B$ at constant purchasing.power of year 2 for years 1, 2, and 3 respectively? Remember: step 1, make sure that the general price index has the correct base year; step 2, transform the nominal aggregat product in A$ into the real aggregate product in A$ using the correct general price index; and step 3, transform the real aggregate product in A$ into the real aggregate product in B$ using the correct exchange rate (and pay attention that exchanges rates are B$/A$, so you may need to use division or multiplication). Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency B$. B$2160 B$2592 "B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (BS/AS). 1.00 1.20 1.35 PPP exchange rate (BS/A$). 1.50 1.80 2.00

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency B$. B$2160 B$2592 B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (B$/A$). 1.00 1.20 1.35 PPP exchange rate (B$/A$). 1.50 1.80 2.00 a.. None of the alternatives is correct. O b. B$2250, B$2700 and B$3375. O c. B$694, B$833 and B$1042. O d. B$1500, B$1800 and B$2250. O e. B$1875, B$2700 and B$3750.
Transcribed Image Text:Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency B$. B$2160 B$2592 B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (B$/A$). 1.00 1.20 1.35 PPP exchange rate (B$/A$). 1.50 1.80 2.00 a.. None of the alternatives is correct. O b. B$2250, B$2700 and B$3375. O c. B$694, B$833 and B$1042. O d. B$1500, B$1800 and B$2250. O e. B$1875, B$2700 and B$3750.
Given the information in the table below, what is country A's real aggregate product in B$ at constant purchasing.power of year 2 for years 1, 2, and 3 respectively? Remember: step 1, make sure that the general price index has the correct base year; step 2, transform the nominal aggregate product in A$ into the real aggregate product in AS using the correct general price index; and step 3, transform the real aggregate product in AS into the real aggregate product in B$ using the correct exchange rate (and pay attention that exchanges rates are B$/A$, so you may need to use division or multiplication). Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency BS. B$2160 B$2592 "B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (BS/AS). 1.00 1.20 1.35 PPP exchange rate (BS/A$). 1.50 1.80 2.00
Transcribed Image Text:Given the information in the table below, what is country A's real aggregate product in B$ at constant purchasing.power of year 2 for years 1, 2, and 3 respectively? Remember: step 1, make sure that the general price index has the correct base year; step 2, transform the nominal aggregate product in A$ into the real aggregate product in AS using the correct general price index; and step 3, transform the real aggregate product in AS into the real aggregate product in B$ using the correct exchange rate (and pay attention that exchanges rates are B$/A$, so you may need to use division or multiplication). Year 1 Year 2 Year 3 Country A's nominal aggregate product in the local currency A$. A$1000 A$1500 A$1800 Country A's general price index. 1.000 1.250 1.200 Country B's nominal aggregate product in the local currency BS. B$2160 B$2592 "B$3888 Country B's general price index. 0.500 0.625 1.000 Market exchange rate (BS/AS). 1.00 1.20 1.35 PPP exchange rate (BS/A$). 1.50 1.80 2.00
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