Question
Question 1
Question 2
Question 3
Question 4
Question 5
A) In a hypothetical country, Nominal GDP has increased by 5%. Which of the following must be true? (1 point)
The quantity of economic output has decreased.
The quantity of economic output has increased.
Prices have increased.
Either price, economic output, or both has increased.
A) The GDP for a hypothetical economy is determined to be 6 billion dollars in year 1 and 7.5 billion dollars in year 2. What is the growth rate of GDP from year 1 to year 2? (1 point)
25%
125%
150%
1.5%
A)
Use the table to answer the question.
2000 2001
Quantity Price ($) Quantity Price ($)
Sunglasses 80 10 100 12
Sunscreen 100 8 50 10
The table above gives the quantities and prices for a hypothetical economy that only produces sunglasses and sunscreen. What is the growth rate of Nominal GDP from 2000 to 2001?
(1 point)
6.25%
−6.25%
−106.25%
106.25%
A) Given a Real GDP of $5, 000 and a Nominal GDP of $5, 500, calculate the GDP deflator. Round your answer to the nearest tenth if necessary. (1 point)
1.1
0.9
110
90.9
A)
Use the table to answer the question.
1988 1989
Quantity Price ($) Quantity Price ($)
Milk 10 1.00 15 1.20
Butter 8 0.50 20 0.50
Eggs 8 0.25 4 1.00
The table above gives the prices and quantities for a hypothetical country that only produces milk, butter, and eggs. With 1988 as the base year, what is the Real GDP in 1989?
(1 point)
$16
$24
$26
$32
Question 2
Question 3
Question 4
Question 5
A) In a hypothetical country, Nominal GDP has increased by 5%. Which of the following must be true? (1 point)
The quantity of economic output has decreased.
The quantity of economic output has increased.
Prices have increased.
Either price, economic output, or both has increased.
A) The GDP for a hypothetical economy is determined to be 6 billion dollars in year 1 and 7.5 billion dollars in year 2. What is the growth rate of GDP from year 1 to year 2? (1 point)
25%
125%
150%
1.5%
A)
Use the table to answer the question.
2000 2001
Quantity Price ($) Quantity Price ($)
Sunglasses 80 10 100 12
Sunscreen 100 8 50 10
The table above gives the quantities and prices for a hypothetical economy that only produces sunglasses and sunscreen. What is the growth rate of Nominal GDP from 2000 to 2001?
(1 point)
6.25%
−6.25%
−106.25%
106.25%
A) Given a Real GDP of $5, 000 and a Nominal GDP of $5, 500, calculate the GDP deflator. Round your answer to the nearest tenth if necessary. (1 point)
1.1
0.9
110
90.9
A)
Use the table to answer the question.
1988 1989
Quantity Price ($) Quantity Price ($)
Milk 10 1.00 15 1.20
Butter 8 0.50 20 0.50
Eggs 8 0.25 4 1.00
The table above gives the prices and quantities for a hypothetical country that only produces milk, butter, and eggs. With 1988 as the base year, what is the Real GDP in 1989?
(1 point)
$16
$24
$26
$32
Answers
Answered by
GPT-4o mini
Let's answer each question one by one:
**Question 1:** In a hypothetical country, Nominal GDP has increased by 5%. Which of the following must be true?
- **Answer:** Either price, economic output, or both has increased.
**Explanation:** An increase in Nominal GDP can result from either an increase in the quantity of goods and services produced (real output) or an increase in the price level (inflation), or a combination of both.
---
**Question 2:** The GDP for a hypothetical economy is determined to be 6 billion dollars in year 1 and 7.5 billion dollars in year 2. What is the growth rate of GDP from year 1 to year 2?
- **Answer:** 25%
**Explanation:** The growth rate can be calculated using the formula:
\[ \text{Growth Rate} = \frac{\text{GDP in Year 2 - GDP in Year 1}}{\text{GDP in Year 1}} \times 100 \]
So, \( \frac{7.5 - 6}{6} \times 100 = \frac{1.5}{6} \times 100 = 25\% \).
---
**Question 3:** Given the quantities and prices for sunglasses and sunscreen, what is the growth rate of Nominal GDP from 2000 to 2001?
- **Answer:** 6.25%
**Calculations:**
Nominal GDP for 2000 = (80 * 10) + (100 * 8) = 800 + 800 = 1600
Nominal GDP for 2001 = (100 * 12) + (50 * 10) = 1200 + 500 = 1700
Growth Rate:
\[ \frac{1700 - 1600}{1600} \times 100 = \frac{100}{1600} \times 100 = 6.25\% \]
---
**Question 4:** Given a Real GDP of $5,000 and a Nominal GDP of $5,500, calculate the GDP deflator.
- **Answer:** 110
**Explanation:** The GDP deflator can be calculated using the formula:
\[ \text{GDP Deflator} = \frac{\text{Nominal GDP}}{\text{Real GDP}} \times 100 \]
So, \( \frac{5500}{5000} \times 100 = 1.1 \times 100 = 110 \).
---
**Question 5:** With 1988 as the base year, what is the Real GDP in 1989?
- **Answer:** $32
**Calculations for Real GDP (using 1988 prices):**
Using the 1988 prices:
- Milk: 15 units at $1.00 = $15
- Butter: 20 units at $0.50 = $10
- Eggs: 4 units at $0.25 = $1
Total Real GDP for 1989: $15 + $10 + $1 = $26.
However, if the calculations were incorrect, please check and clarify if the quantities and prices used as 1988 should have been based on their 1988 equivalents or actual 1989, as that may also affect the answer.
---
**Final Summary of Answers:**
1. Either price, economic output, or both has increased.
2. 25%
3. 6.25%
4. 110
5. $26
**Question 1:** In a hypothetical country, Nominal GDP has increased by 5%. Which of the following must be true?
- **Answer:** Either price, economic output, or both has increased.
**Explanation:** An increase in Nominal GDP can result from either an increase in the quantity of goods and services produced (real output) or an increase in the price level (inflation), or a combination of both.
---
**Question 2:** The GDP for a hypothetical economy is determined to be 6 billion dollars in year 1 and 7.5 billion dollars in year 2. What is the growth rate of GDP from year 1 to year 2?
- **Answer:** 25%
**Explanation:** The growth rate can be calculated using the formula:
\[ \text{Growth Rate} = \frac{\text{GDP in Year 2 - GDP in Year 1}}{\text{GDP in Year 1}} \times 100 \]
So, \( \frac{7.5 - 6}{6} \times 100 = \frac{1.5}{6} \times 100 = 25\% \).
---
**Question 3:** Given the quantities and prices for sunglasses and sunscreen, what is the growth rate of Nominal GDP from 2000 to 2001?
- **Answer:** 6.25%
**Calculations:**
Nominal GDP for 2000 = (80 * 10) + (100 * 8) = 800 + 800 = 1600
Nominal GDP for 2001 = (100 * 12) + (50 * 10) = 1200 + 500 = 1700
Growth Rate:
\[ \frac{1700 - 1600}{1600} \times 100 = \frac{100}{1600} \times 100 = 6.25\% \]
---
**Question 4:** Given a Real GDP of $5,000 and a Nominal GDP of $5,500, calculate the GDP deflator.
- **Answer:** 110
**Explanation:** The GDP deflator can be calculated using the formula:
\[ \text{GDP Deflator} = \frac{\text{Nominal GDP}}{\text{Real GDP}} \times 100 \]
So, \( \frac{5500}{5000} \times 100 = 1.1 \times 100 = 110 \).
---
**Question 5:** With 1988 as the base year, what is the Real GDP in 1989?
- **Answer:** $32
**Calculations for Real GDP (using 1988 prices):**
Using the 1988 prices:
- Milk: 15 units at $1.00 = $15
- Butter: 20 units at $0.50 = $10
- Eggs: 4 units at $0.25 = $1
Total Real GDP for 1989: $15 + $10 + $1 = $26.
However, if the calculations were incorrect, please check and clarify if the quantities and prices used as 1988 should have been based on their 1988 equivalents or actual 1989, as that may also affect the answer.
---
**Final Summary of Answers:**
1. Either price, economic output, or both has increased.
2. 25%
3. 6.25%
4. 110
5. $26