Exploring Macroeconomics
Exploring Macroeconomics
7th Edition
ISBN: 9781285859446
Author: Sexton, Robert L.
Publisher: Cengage Learning
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Chapter 11, Problem 12P
To determine

To fill in the blanks with calculations.

Expert Solution & Answer
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Answer to Problem 12P

125, $8000, $18000, $77008, $10000

Explanation of Solution

    YearGDP DeflatorNominal GDP (in billions_Real GDP (in billions)
    200890.9$7000$77008
    2009100$8000$8000
    2010125$10000$8000
    2011140$14000$10000
    2012150$18000$12000

GDP Deflator for 2010,GDP Deflator= Nominal GDP÷Real GDP×100

                                                             = 10000÷80000×100

                                                             = 125 is the GDP Deflator in 2010

Nominal GDPfor 2009= x÷8000×100 = 100

 = 800,000x = 100

= x = 800,000÷100

= x = 8000

 Hence, Nominal GDP for 2009 is 8000

Nominal GDP for 2012= x÷12000×100 = 150

= 1,200,000x = 150

= x = 1,200,000÷150

= x = 8000

 Hence, Nominal GDP for 2012 is 8000

Real GDP for 2008= 7000÷x×100 = 90.9

                               = 700,000x = 90.9

                               = x = 700.,000÷90.9

                               = x = 77,008

Hence, Real GDP for 2008 is 77,008

Real GDP for 2011=     14000÷x×100 = 140

=      1,400,000x = 140

                               = x = 1,400,000÷140

                               = x = 10,000

Hence, Real GDP for 2011 is 10,000

Economics Concept Introduction

Introduction:

The full form of GDP is gross national product and it is the way that measures the total economy's output of goods and services in the country. The Nominal GDP is the economy's output without the inflation adjustments. The Nominal GDP is usually higher than the real GDP as inflation is a positive number. Real GDP is inflation adjusted measure that has the value of goods and services produced by an economy in a particular given year.

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