Asked by Janice Walker on Apr 29, 2024
Verified
If nominal gross domestic product (GDP) for a particular year is $6 trillion and real gross domestic product (GDP) for that year is $5 trillion,then the GDP price index for that year is _____.
A) 1.2
B) 17
C) 20
D) 83
E) 120
GDP Price Index
A measure that tracks changes in the prices of goods and services included in the Gross Domestic Product, allowing for inflation-adjusted economic assessments.
Nominal Gross Domestic Product
The measure of a country's overall economic output at current market prices, without adjusting for inflation or deflation.
Real Gross Domestic Product
Measures the value of all final goods and services produced within a country's borders in a given time period, adjusted for inflation, reflecting the actual productivity of an economy.
- Learn how to calculate the GDP price index and understand its significance.
Verified Answer
AR
Abdellah RahmouneMay 03, 2024
Final Answer :
E
Explanation :
The GDP price index is calculated by dividing the nominal GDP by the real GDP and then multiplying by 100. So, in this case, it would be ($6 trillion / $5 trillion) * 100 = 120.
Learning Objectives
- Learn how to calculate the GDP price index and understand its significance.