Ditauiuns, opportunity costs, price of the product D. costs of production, price
ID: 1128524 • Letter: D
Question
Ditauiuns, opportunity costs, price of the product D. costs of production, price of the product, and subsidies Use the toble below to answer questions 22-25. Quantity Price Quantity Price Product (2008) (2008) (2009) (2009) Computers Pizzas Burgers 30 100 200 $1,000 28 150 210 $995 15 20 10 20 22. Suppose an economy produces only the three final goods listed in the table above. What is the real GDP in 2008 if 2009 is the base year (i.e, using 2009 prices)? A. $34,310 B. $35,350 C. $35,000 D. $33,700 23. Suppose an economy produces only the three final goods listed in the table above. What is the nominal GDP in 2009? A. $34,310 B. $35,350 C. $35,000 D. $33,700 24. Suppose an economy produces only the three final goods listed in the table above. What is the real GDP in 2009 if 2009 is the base year(i.e., using 2009 prices)? A $34,310 B. $35,350 C. $35,000 D. $33,700 25. Suppose an economy produces only the three final goods listed in the table above. What was the growth rate of real GDP between 2008 and 2009 if 2009 is the base year (i.e., using 2009 prices)? A. -2.94% B. -3,17% C. D. -1.97% 2.01%Explanation / Answer
Answer : 22) If 2009 is base year then the real GDP in 2008 is (B) $35,350. In this case quantities of 2008 are multiplied by prices of 2009. Therefore,
Real GDP in 2008 = (30×1000) + (100×10) + (200×20) = $35,350.
23) The nominal GDP in 2009 is (A) $34,310. In this case the quantities of 2009 are multiplied by the current prices.
24) If the base year is 2009 then the real GDP in 2009 is (A) $34,310. In this case prices of 2009 are multiplied by quantities of 2009.
25) If the base year is 2009 then the growth rate between 2008 and 2009 is (A) -2.94%.
The calculation of this growth rate is following :
(Real GDP of 2009 / real GDP of 2008) - 1
= (34310 / 35350) - 1 = (- 0.0294/100) × 100 = -2.94%.