Back to Assignment Attempts Keep the Highest / 4 2 . Real versus nominal GDP Consider a simple economy that produces two goods: cupcakes and muffins. The following table shows the prices and quantities of the goods over a three-year period. Cupcakes Muffins Price Quantity Price Quantity Year ( Dollars per cupcake) (Number of cupcakes) (Dollars per muffin) (Number of muffins) 2018 120 1 195 2019 N 130 A 195 2020 4 130 A 145Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP Year (Dollars) ( Base year 2018, dollars) GDP Deflator 2018 2019 2020 From 2019 to 2020, nominal GDP , and real GDP The inflation rate in 2020 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? O Real GDP includes the value of exports, but nominal GDP does not. Real GDP is not influenced by price changes, but nominal GDP is. O Real GDP does not include the value of intermediate goods and services, but nominal GDP does. Grade It Now Save & Continue3 . Problems and Applications Q1 Indicate what components of GDP (if any) each of the following transactions would affect. Check all that apply. Government Net Transaction Consumption Investment Purchases Exports California hires workers to repave Highway 101. O O O You purchase a box of Belgian chocolate. O O 0 O Your parents pay an accountant to file their tax returns. 0 O Dell sells a desktop computer from its inventory to the Johnson family. 0 Uncle John receives a check from the federal government for O 0 O unemployment insurance benefits. Aunt Polly buys a new air conditioner from a domestic manufacturer. O 0 0 0 Uncle John orders 10 new computers for his finance business. 0 0 Ford manufactures a Focus and adds it to its inventory. O 0 0 Grade It Now Save 2. Continue