The following table shows nominal GDP and an appropriate price index for a group of selected years. Compute real GDP. Indicate in each calculation whether you are inflating or deflating the nominal GDP data. Instructions: Enter your responses in the gray-shaded cells. Round your answers to 2 decimal places. Nominal GDP, Billions Price Index Year Real GDP, Billions Effect on Nominal GDP (2005 = 100) 1978 $2,298.80 40.4 1988 5,105.40 66.98 1998 8,798.50 85.51 2008 14,446.40 108.48 2018 20,507.10 128.59
The following table shows nominal GDP and an appropriate price index for a group of selected years. Compute real GDP. Indicate in each calculation whether you are inflating or deflating the nominal GDP data. Instructions: Enter your responses in the gray-shaded cells. Round your answers to 2 decimal places. Nominal GDP, Billions Price Index Year Real GDP, Billions Effect on Nominal GDP (2005 = 100) 1978 $2,298.80 40.4 1988 5,105.40 66.98 1998 8,798.50 85.51 2008 14,446.40 108.48 2018 20,507.10 128.59
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter8: Economic Fluctuations, Unemployment, And Inflation
Section: Chapter Questions
Problem 14CQ
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Step 1
Real GDP = (Nominal GDP/Deflator)*100
If the Real GDP is greater than nominal, then it is inflating
If the Real GDP is lesser than nominal, then it is deflating
In this case, the price index reflects the GDP deflator's value.
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