A tiny fictional country produces a single good. In 2010, the country produced a total of 5,000 units at a price of $2

Question

per unit. In 2011, the country produced a total of of 6,000 units at a price of $3
per unit. Using 2010 as the base year, what was this country's real GDP in 2011?(1 point)
Responses

$18,000
18,000 dollars

$15,000
15,000 dollars

$10,000
10,000 dollars

Answer 1

To calculate the country's real GDP in 2011 using 2010 as the base year, we need to adjust the 2011 GDP value for inflation.

First, calculate the nominal GDP in 2011:
6,000 units * $3 per unit = $18,000

Next, calculate the GDP deflator using 2010 as the base year:
GDP deflator = (Nominal GDP / Real GDP) x 100
GDP deflator = ($18,000 / $10,000) x 100
GDP deflator = 180

Now, calculate the real GDP in 2011:
Real GDP = (Nominal GDP / GDP deflator) x 100
Real GDP = ($18,000 / 180) x 100
Real GDP = $10,000

Therefore, the country's real GDP in 2011 using 2010 as the base year was $10,000.

So, the correct answer is $10,000.