Consider an economy that produces only chocolate bars and trail mik. The product
ID: 1141039 • Letter: C
Question
Consider an economy that produces only chocolate bars and trail mik. The production and prices in each of the three years are represented in the following table. Assume yoar 1is the Year 1 Year 2 Year 3 Price Quantity Price QuantityPrice Quantity $4 $3 Chocolate Bars $5 S6 Trail Mix $5 $4 24. In which year does nominal GDP equal real GDP? a. Year 1 b. Year 2 C. Year 3 d. None of the above 25. Nominal GDP in year 2 is equal to a. b. $22 $30 . S32 d. None of the above 26. Real GDP in year 3 is equal to a. $38 b. $54 C. $55 d. None of the above 27. Between years 1 and 2, the GDP deflator is a. 73.33 b. 100.00 c. 136.36 d. None of the above 28. Between years 1 and 2, the inflation rate (as calculated by the GDP deflator) is a. b. c, d. 26.67% deflation Neither inflation nor deflation 36.36% inflation 136.36% inflationExplanation / Answer
24.
a. year 1
because Year 1 is base year, so due to which real GDP and nominal GDP are equal
25.
nominal GDP year 2=5*4+5*2=30
26.
real GDP year 3=4*5+3*6=38
27.
GDP deflator=(nominal GDP year 2/real GDP year 2)*100
=((5*4+5*2)/(4*4+3*2))*100
=136.36
28.
inflation rate=136.36/100-1
=36.36%
the above is answer..