Question #48437

given that in 1990, nominal GDP = 2063 and real GDP(base 1990) = 2063. in 1991, nominal GDP = 2113 and real GDP = 2088. for both years calculate:

a. nominal GDP growth

b. real GDP growth

c. GDP deflator

d. rate of inflation

a. nominal GDP growth

b. real GDP growth

c. GDP deflator

d. rate of inflation

Expert's answer

a. nominal GDP growth = nominal GDP (1991) / nominal GDP (1990) = 2113 / 2063 = 1.0242

b. real GDP growth = real GDP (1991) / real GDP (1990) = 2088 / 2063 = 1.0121

c. GDP deflator (1990) = nominal GDP (1990)/real GDP(1990) = 2063/2063 = 1

GDP deflator (1991) = nominal GDP (1991)/real GDP (1991) = 2113/2088=1.01197

d. rate of inflation (1990) = nominal GDP (1990)/ real GDP(1990) = 2063/2063 = 1

rate of inflation (1991) = nominal GDP (1991)/ real GDP(19910 = 2113/2088 = 1.0119

b. real GDP growth = real GDP (1991) / real GDP (1990) = 2088 / 2063 = 1.0121

c. GDP deflator (1990) = nominal GDP (1990)/real GDP(1990) = 2063/2063 = 1

GDP deflator (1991) = nominal GDP (1991)/real GDP (1991) = 2113/2088=1.01197

d. rate of inflation (1990) = nominal GDP (1990)/ real GDP(1990) = 2063/2063 = 1

rate of inflation (1991) = nominal GDP (1991)/ real GDP(19910 = 2113/2088 = 1.0119

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