Suppose the following table records the totaloutput and prices for an entire economy. Further, supposethe base year in the following table is 20053.Quantity ofSodaQuantity ofJeansPrice ofPrice ofYearSodaJeans2004€1.00200€10.005020051.0022011.0050a. What is the value of nominal and real GDP in 2004?b. What is the value of nominal and real GDP in 2005?c. Was the increase in nominal GDP from 2004 to 2005mostly due to an increase in real output or due to anincrease in prices?d. What is economic growth in 2005?

Gdp is the standard measure of the value added created through the production of goods and services…

What is the value of nominal and real GDP in 2004? .What is the value of nominal and real GDP in 2005? .Was the increase in nominal GDP from 2004 to 2005 mostly due to an increase in real output or due to an increase in prices?

What is the value of nominal and real GDP in 2004? .What is the value of nominal and real GDP in 2005? .Was the increase in nominal GDP from 2004 to 2005 mostly due to an increase in real output or due to an increase in prices?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Suppose the following table records the total
output and prices for an entire economy. Further, suppose
the base year in the following table is 2005
3.
Quantity of
Soda
Quantity of
Jeans
Price of
Price of
Year
Soda
Jeans
2004
€1.00
200
€10.00
50
2005
1.00
220
11.00
50
a. What is the value of nominal and real GDP in 2004?
b. What is the value of nominal and real GDP in 2005?
c. Was the increase in nominal GDP from 2004 to 2005
mostly due to an increase in real output or due to an
increase in prices?
d. What is economic growth in 2005?

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