contestada

Assume that in year 1 an economy produces 1000 units of output and they sell for $100 a unit, on average. in year 2, the economy produces the same 1000 units of output, and sells it for $110 a unit, on average. use year 1 prices to calculate real gdp in year 1 and year 2. what happened to real gdp between years 1 and 2? why?

Respuesta :

RedTomato
The real GDP in year 1 (quantities in year 1 times prices in year 1) is equal to$100,000.The real GDP in year 2 is calculated by multiplying the output produced in this specific year times the prices at which the products sold on average in year 1.The real GDP in year 2 is also equal to $100,000.Although prices increased from $100 in year 1 to $110 in year 2, the total amount of output produced did not change and real GDP should be equal for these two years
marvineetesh3

The GDP from year 1 to year 2 will be increased by 10%, because the total value of goods and servicers sell to the foreign country is greater than the sale to domestic country.

What is GDP?

The monetary worth of all finished goods and services produced inside a country during a certain period is known as the gross domestic product (GDP).

GDP is a measure of a country's economic health that is used to estimate its size and rate of growth.

GDP can be computed in three different ways: expenditures, production, and income.

Computation of real GDP  for year 1 and 2:

The formula of real GDP:

[tex]\text{Real GDP} = \text{Price} \times \text{Quantity}[/tex]

Now, apply the values in the formula of real GDP,

Year 1:

[tex]\text{Real GDP} = \text{Price} \times \text{Quantity}\\\\\text{Real GDP} = $100 \times 1,000\text{Units}\\\\\text{Real GDP} = 1,00,000[/tex]

Year 2:

[tex]\text{Real GDP} = \text{Price} \times \text{Quantity}\\\\\text{Real GDP} = $110 \times 1,000\text{Units}\\\\\text{Real GDP} = 1,10,000[/tex]

Therefore, the real GDP increased by 10% from year 1 to year 2.

Learn more about GDP, refer to:

https://brainly.com/question/15682765

Otras preguntas