Nominal GDP was $10,624 billion in year 1 and the GDP price index was 104. Nominal GDP was $11,246 in year 2 and the GDP deflator that year was 106. What was real GDP in years 1 and 2, respectively?
a. $9,983 billion and $10,111 billion
b. $10,215 billion and $10,609 billion
c. $10,022 billion and $10,813 billion
d. $10,624 billion and $11,246 billion
b. $10,215 billion and $10,609 billion
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A rational choice is ___________
A. the best thing you must forgo to get something B. what you are willing to forgo to get something C. made by comparing marginal benefit and marginal cost D. the best for society
How will the purchase of $100 million of government securities by the Federal Reserve change bank reserves and total checking account deposits in the banking system as a whole? Assume that banks do not hold any excess reserves, that households and
firms do not change the amount of currency they hold, and that the required reserve ratio is 20 percent.
Suppose the Fed conducts an open market purchase of bonds. This monetary policy action will tend to cause
A) the price of bonds to increase, and the interest rate to increase. B) the price of bonds to increase, and the interest rate to decrease. C) the price of bonds to decrease, and the interest rate to increase. D) the price of bonds to decrease, and the interest rate to decrease.
The balance of payments summarizes the transactions that occur during a given time period between
a. the government of one country and the government of another country b. the national government and local governments in the same country c. individuals, firms, and government of one country and individuals, firms, and governments throughout the rest of the world d. individuals, firms, and governments of two countries e. non-government residents (individuals and firms) of two countries