1. Business
  2. Economics
  3. 5 real versus nominal gdp consider a simple economy that...

Question: 5 real versus nominal gdp consider a simple economy that...

Question details

5. Real versus nominal GDP Consider a simple economy that produces two goods: cupcakes and envelopes. The following table shows the prices and quantities of the goods over a three-year period Cupcakes Envelopes Price (Dollars per cupcake) 2 4 Quantity (Number of cupcakes) 115 150 100 Price Quantity (Number of envelopes) 175 180 160 (Dollars per envelope) Year 2012 2013 2014 2Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP (Dollars) (Base year 2012, dollars) GDP Deflator Year 2012 2013 2014 From 2013 to 2014, nominal GDP ,and real GDP The inflation rate in 2014 was Why is real GDP a more accurate measure of an economys production than nominal GDP? Real GDP does not include the value of intermediate goods and services, but nominal GDP does O Real GDP is not influenced by price changes, but nominal GDP is. Real GDP measures the value of the goods and services an economy produces, but nominal GDP measures the value of the goods and services an economy consumes.

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution