Question
This is my homework... I need help with the last part where it asks: Is the economy expanding equally each year? Why or why not?
This is my homework...
I need help with the last part where it asks: Is the economy expanding equally each year? Why or why not?
my question is how do i answer that. How do i know its expanding equally each year? what do they mean by equally? the same each year?
I've done the calculations for the question below...
a)GDP = (average level of prices) (Quantity of Output)
GDP for year 2000
= 15 x 950
= 14,250
GDP for year 2010
= 20 x 850
= 17,000
GDP for year 2020
= 25 x 1,500
= 37,500
b)Price index = Nominal GDP current year / Nominal GDP base year (2010) x 100
Price index for year 2000
= 14,250/17,000 x 100
= 83.82
Price index for year 2010
= 17,000/17,000 x100
= 100
Price index for year 2020
= 37,500/17,000 x 100
= 220.58
c)REAL GDP = Nominal GDP / Price Index x 100
GDP for year 2000
= 14,250/83.82 x 100
= 17,000.71
GDP for year 2010
= 17,000 / 100 x 100
= 17,000
GDP for year 2020
= 37,500 / 220.58 x 100
= 17000.63
GROWTH RATE: present - past / past x 100
For 2000 to 2010
= 100 - 83.82/83.82 x 100
= 19.30 %
For 2010 to 2020
= 220.58 - 100 / 100 x 100
= 120.58 %
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