Macro Country produces a single good. In 2022, Macro Country produces a total of 5,500 units at a price of $2 per unit. In 2023, Macro Country produces a total of 7,000 units at a price of $3 per unit. Using 2022 as the base year, what was Macro Country's real GDP in 2023?(2 points)

Question

Responses

$10,500
$10,500

$14,000
$14,000

$15,500
$15,500

$21,000

Answer 1

To calculate Macro Country's real GDP in 2023 using 2022 as the base year, we need to use the price from the base year (2022) to evaluate the output from 2023.

1. Identify the production quantity in 2023: 7,000 units.
2. Identify the price in the base year (2022): $2 per unit.

Now, we can calculate the real GDP for 2023:

\[ \text{Real GDP in 2023} = \text{Quantity produced in 2023} \times \text{Price in base year (2022)} \]

\[ \text{Real GDP in 2023} = 7,000 \text{ units} \times 2 \text{ dollars/unit} \]

\[ \text{Real GDP in 2023} = 14,000 \text{ dollars} \]

Thus, Macro Country's real GDP in 2023 is $14,000.

So the correct response is: $14,000.