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Suppose the economy has the following consumption pattern Sandwich Hotdog Cell phone Super car 2019 Price $7 $3 $200 $5,000 Quantity 500 400 100
Suppose the economy has the following consumption pattern Sandwich Hotdog Cell phone Super car 2019 Price $7 $3 $200 $5,000 Quantity 500 400 100 3 2020 Price $10 $5 $250 $7,000 Quantity 200 400 100 2 2021 Price $5 $2 $200 $6,000 Quantity 500 600 200 4 a. Calculate the nominal GDPs of this economy. b. Calculate the real GDP of this economy using 2020 as the base year. c. Calculate the GDP growth in 2021 for nominal GDP and real GDP. Explain why they are different.
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