In 2020, the country produced 16 machinery and 40 services. In 2020, the machinery price was Pm_2020 = 90, and of services, Ps_2020 = 44. In 2019, the machinery price was Pm_2019 = 72, and of services Ps_2019 = 39. -Calculate the nominal GDP of 2020. -The GDP of 2019 was 2607, and the country made 14 machinery. Find how many services the country produced.
In 2020, the country produced 16 machinery and 40 services. In 2020, the machinery price was Pm_2020 = 90, and of services, Ps_2020 = 44. In 2019, the machinery price was Pm_2019 = 72, and of services Ps_2019 = 39. -Calculate the nominal GDP of 2020. -The GDP of 2019 was 2607, and the country made 14 machinery. Find how many services the country produced.
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter8: Economic Fluctuations, Unemployment, And Inflation
Section: Chapter Questions
Problem 14CQ
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Question
Part 1)
In 2020, the country produced 16 machinery and 40 services.
In 2020, the machinery price was Pm_2020 = 90, and of services, Ps_2020 = 44.
In 2019, the machinery price was Pm_2019 = 72, and of services Ps_2019 = 39.
-Calculate the nominal GDP of 2020.
-The GDP of 2019 was 2607, and the country made 14 machinery. Find how many services the country produced.
Expert Solution
Step 1
Gross domestic product measures the market value of final goods and services produced by a nation during a given period of time.
Nominal GDP measures the market value at the current year price.
i.e., Nominal GDP = (Quantity in current year * Price in current year)
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