. If nominal GDP in a particular year is $770 billion while real GDP is $700...

Question

Question

. If nominal GDP in a particular year is $770 billion while real GDP is $700 billion, we know that since the base year

business economics

Answer 1

Answer #1

GDP Deflator = (Nominal GDP / Real GDP) x 100 = (770 / 700) x 100 = 110

Since inflation rate is measured by % Change in GDP Deflator,

Inflation rate = (110/100) - 1 = 1.1 - 1 = 0.1 = 10%

Since the base year, Inflation rate increased by 10%.

Answer 2

Similar Homework Help Questions

If real GDP in a particular year is $80 billion and nominal GDP is $240 billion,...

If real GDP in a particular year is $80 billion and nominal GDP is $240 billion, the value of the GDP deflator for that year is: Select one: a. 100 b. 200 c. 240 d. 300 e. 333
Real vs. Nominal GDP Year Real GDP Nominal GDP GDP Deflator 1990 $1000 billion $950 billion...

Real vs. Nominal GDP Year Real GDP Nominal GDP GDP Deflator 1990 $1000 billion $950 billion 1995 $1200 billion $1200 billion 1998 $1500 billion 115 2000 $1750 billion 125 What is the base year? What is the value of the GDP Deflator in the base year? What is the value of the GDP Deflator in 1990? What is the value of Real GDP in 1998? What is the value of Nominal GDP in 2000?
QUESTION 27 If nominal GDP in 2014 is $20,000 billion while real GDP is $16,500 billion,...

QUESTION 27 If nominal GDP in 2014 is $20,000 billion while real GDP is $16,500 billion, then the GDP deflator in 2014 is: O A 125 OB 1212 oC 150 OD. 110 OE 80 We were unable to transcribe this image

QUESTION 16 If nominal GDP in 2014 is $20,000 billion while real GDP is $16,000 billion,...

QUESTION 16 If nominal GDP in 2014 is $20,000 billion while real GDP is $16,000 billion, then the GDP deflator in 2014 is A. 125 B.80 C. 110 D. 150
Question 2 If Nominal GDP is $12,000 billion and the GDP deflator is 80, then Real...

Question 2 If Nominal GDP is $12,000 billion and the GDP deflator is 80, then Real GDP is ________. a) $15,000 billion b) $9,600 billion c) $21,600 billion Question 3 If inflation occurs in a given year, a) the change in the real measurement (GDP) would be equal to the change in the nominal one. b) the change in the real measurement (GDP) would be greater than the change in the nominal one. c) the change in the real measurement...
Suppose the nominal GDP in 2016 in the small country of Arkansia was $32 billion while...

Suppose the nominal GDP in 2016 in the small country of Arkansia was $32 billion while the real GDP in 2016 in Arkansia was $20 billion. If the nominal GDP in 2017 was $34.5 billion and the real GDP was $21 billion, what inflation rate did the citizens of Arkansia experience?

Fill in the missing information: Year Nominal GDP Real GDP GDP Deflator 1 $8,000 billion $8,000...

Fill in the missing information: Year Nominal GDP Real GDP GDP Deflator 1 $8,000 billion $8,000 billion 100 $ 2 $9,028.8 billion 108 billion 3 $9,806.28 $8,527.2 billion The economy's growth rate is % from year 1 to year 2 and % from year 2 to year 3.
Nominal GDP Real GDP 2011 $13,295 billion $11,519 billion 2012 $14,041 billion $11,767 billion In 2011,...

Nominal GDP Real GDP 2011 $13,295 billion $11,519 billion 2012 $14,041 billion $11,767 billion In 2011, the value of the GDP deflator is(Enter your response rounded to the nearest whole number)
Nominal GDP Real GDP 2011 $13,195 billion $11,319 billion 2012 $13,841 billion $11,567 billion 2011,the value...

Nominal GDP Real GDP 2011 $13,195 billion $11,319 billion 2012 $13,841 billion $11,567 billion 2011,the value of the GDP deflator is Enter your response rounded to the nearest whole number)

Nominal GDP Real GDP 2011 $13,495 billion $11,919 billion 2012 $14,241 billion $12,007 billion In 2011,...

Nominal GDP Real GDP 2011 $13,495 billion $11,919 billion 2012 $14,241 billion $12,007 billion In 2011, the value of the GDP deflator is (Enter your response rounded to the nearest whole number.) In 2012, the value of the GDP deflator is (Enter your response rounded to the nearest whole number.)