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Item Amount in 2020 Amount in 2021 Consumption 69,880 70,640 Investment 15,320 16,340 Government Spending 19,450 18,400 Exports 2,500 2,000 Imports 6,000 5,300 The table

Item

Amount in 2020

Amount in 2021

Consumption

69,880

70,640

Investment

15,320

16,340

Government Spending

19,450

18,400

Exports

2,500

2,000

Imports

6,000

5,300

The table above shows the expenditures of an economy in 2020 and 2021, measured in millions of current year dollars.

Calculate the nominal GDP of the economy in 2020 and 2021. Given that the CPI is 1.09 in 2020 and 1.03 in 2021, calculate the real GDP of the economy in 2020 and 2021. Determine the real economic growth rate from 2020 to 2021. What can you conclude regarding the changes in the standard of living and well-being of the residents of the economy in 2021 compared to 2020?

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