1 define a base year b real gdp 3 why do economists

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ar is somewhat arbitrary. Several years in the immediate past might fit the bill, but one gets chosen over the others. 1. Define: a. base year b. real GDP 3. Why do economists compute real GDP? 4. When real GDP increases, which variable, P or Q, is increasing? Reviewing Facts and Concepts Critical Thinking Defining Terms 2. Gross domestic product is $6,000 billion in one year and $6,500 billion the next year. Is output necessarily higher in the second year than in the first? Explain your answer. 300 Chapter 11 Measuring Economic Performance 5. Can GDP go up at the same time that real GDP goes down? Explain your answer. Applying Economic Concepts 6. An economist wants to know whether the “average person” in country X has more goods and services to consume than the “average person” in country Y. Do you recommend that the economist look at per capita GDP or per capita real GDP? Explain your answer. 11 (286-309) EMC Chap 11 11/17/05 6:06 PM Page 301 Focus Questions Measuring Price Changes and the Unemployment Rate Calculating the Change in...
View Full Document

Ask a homework question - tutors are online