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?

Question

(1 point)
Responses

6.25%
6.25 percent

106.25%
106.25 percent

−6.25%
negative 6.25 percent

−106.25%

Answer 1

To calculate the growth rate of Nominal GDP from 2000 to 2001, you need to determine the Nominal GDP for both years and then use the formula for growth rate:

\[ \text{Growth Rate} = \frac{\text{GDP}{2001} - \text{GDP}{2000}}{\text{GDP}_{2000}} \times 100 \]

However, since I do not have access to the table with quantities and prices for sunglasses and sunscreen, I can guide you on how to calculate it:

1. Calculate Nominal GDP for 2000:

   • Multiply the quantity of each product by its price and sum these values.

2. Calculate Nominal GDP for 2001:

   • Repeat the process for the year 2001 using the respective quantities and prices.

3. Insert GDP values into the growth rate formula:

   • Use the Nominal GDP values obtained in Steps 1 and 2.

Once you complete these calculations, you will be able to select the correct growth rate from the given options. If you provide the quantities and prices, I can help you calculate the GDPs and the growth rate.