Principles of Economics- Mankiw (5th) 494

Principles of Economics- Mankiw (5th) 494 - 510 PA R T E I...

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510 PART EIGHT THE DATA OF MACROECONOMICS a. Compute nominal GDP, real GDP, and the GDP deflator for each year, using 2001 as the base year. b. Compute the percentage change in nominal GDP, real GDP, and the GDP deflator in 2002 and 2003 from the preceding year. For each year, identify the variable that does not change. Explain in words why your answer makes sense. c. Did economic well-being rise more in 2002 or 2003? Explain. 6. Consider the following data on U.S. GDP: N OMINAL GDP GDP D EFLATOR Y EAR ( IN BILLIONS )( BASE YEAR 1992) 1996 7,662 110 1997 8,111 112 a. What was the growth rate of nominal GDP between 1996 and 1997? (Note: The growth rate is the percentage change from one period to the next.) b. What was the growth rate of the GDP deflator between 1996 and 1997? c. What was real GDP in 1996 measured in 1992 prices? d. What was real GDP in 1997 measured in 1992 prices? e. What was the growth rate of real GDP between 1996 and 1997? f. Was the growth rate of nominal GDP higher or lower than the growth rate of real GDP? Explain.
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