Historically, what are the highest and lowest unemployment rates in our History **Real vs Nominal GDP**### 2011- **Quantity & Price** 1. **Cars** - Quantity: 50 - Price: $20,000 - Total Value: __________ 2. **Computers** - Quantity: 200 - Price: $3,000 - Total Value: __________ 3. **What is 2011's nominal GDP?** __________### 2012- **Quantity & Price** 4. **Cars** - Quantity: 70 - Price: $23,000 - Total Value: __________ 5. **Computers** - Quantity: 250 - Price: $3,500 - Total Value: __________ 6. **What is 2012's nominal GDP?** __________ 7. **Calculate the rate of growth of nominal GDP.** __________% 8. **Is this rate an accurate reflection of economic growth? Why or why not?**To see true growth, we need to recalculate nominal GDP into real GDP. To do this, recalculate both GDP for both years using 2012 as your base year.9. **2011 real GDP (using 2012's prices)**10. **2012 real GDP (using 2012's prices)**11. **What is real economic growth for this nation?** __________%12. **What do you notice about real and nominal GDP in the base year?**

Answered: Historically, what are the highest and…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Historically, what are the highest and lowest unemployment rates in our History

**Real vs Nominal GDP**

### 2011
- **Quantity & Price**
1. **Cars**
- Quantity: 50
- Price: $20,000
- Total Value: __________
2. **Computers**
- Quantity: 200
- Price: $3,000
- Total Value: __________
3. **What is 2011's nominal GDP?** __________

### 2012
- **Quantity & Price**
4. **Cars**
- Quantity: 70
- Price: $23,000
- Total Value: __________
5. **Computers**
- Quantity: 250
- Price: $3,500
- Total Value: __________
6. **What is 2012's nominal GDP?** __________
7. **Calculate the rate of growth of nominal GDP.** __________%
8. **Is this rate an accurate reflection of economic growth? Why or why not?**

To see true growth, we need to recalculate nominal GDP into real GDP. To do this, recalculate both GDP for both years using 2012 as your base year.

9. **2011 real GDP (using 2012's prices)**

10. **2012 real GDP (using 2012's prices)**

11. **What is real economic growth for this nation?** __________%

12. **What do you notice about real and nominal GDP in the base year?**

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