What was the growth rate for real gdp

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Reference no: EM131023411

Consider the following table of price and quantities produced for a small economy.

Year

Footballs

Grapes

Dresses

Wine

 

Price      Quantity

Price      Quantity

Price      Quantity

Price       Quantity

2000

2001

$5             3

$6             4

$1            15

$2            20

$20            4

$25            5

$5             5

$8.50           6

a) Assume that all grapes in this economy are used to make wine. Compute nominal GDP for 2000 and 2001.

b) Continue to assume that all grapes are used to make wine. Using 2000 as the base year, compute real GDP in 2000 and 2001.

c) Find the GDP Deflator for 2000 and 2001 on a 100-point scale. Report your answers to two decimal places, if necessary.

d) What was the growth rate for real GDP between 2000 and 2001? Express your answer as a percentage.

e) Assume that the typical consumer in this economy purchases 2 footballs, 1 dress, and 4 bottles of wine per year. Using 2000 as the base year, find the CPI in 2000 and 2001 on a 100-point scale.

f) What was the inflation rate in this economy between 2000 and 2001? Express your answer as a percentage.

Reference no: EM131023411

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