The nominal GDP for 2021 is $125 billion, and the real GDP for 2021 is $100 billion. (1). Calculate the GDP Deflator in 2021? Show your calculation. (2). Also assume that the GDP deflator in 2020 was 100. What is the inflation rate over the 1-year period? Show your calculation.

The nominal GDP for 2021 is $125 billion, and the real GDP for 2021 is $100 billion. (1). Calculate the GDP Deflator in 2021? Show your calculation. (2). Also assume that the GDP deflator in 2020 was 100. What is the inflation rate over the 1-year period? Show your calculation.

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter13: Inflation

Section: Chapter Questions

Problem 8SQP

See similar textbooks

Related questions

Q: A newly proposed project has a first cost of $ 242835 and estimated annual income of $49564 per year…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: Initial Investment, Alternative 1,% -25,000 9.6 -35,000 15.1 -40,000 13.4 -60,000 25.4 20.2 -75,000…

A: Internal rate of return refers to the rate at which the discounted present value of the future cash…

Q: Use the supply and demand data to complete the table. Price Quantity Demanded Quantity Supplied…

A: Quantity demanded is inversely related to price. Quantity supplied is positively related to price.…

Q: explain with cases why technology progress is the main determinant for the long-term economic…

A: When adjusted for inflation, economic growth is the increase or improvement in the market value of…

Q: 8) Determine the capitalized cost of an alternative that has a first cost of $155.000, an annual…

A: The term maintenance expense refers to any cost incurred by an individual or business to keep their…

Q: What would be the Primary deficit if fiscal deficit is 77 and Interest payment is 66?

A: Interest payments are the expense of acquiring cash. The borrower makes these payments as well as…

Q: A sheet of paper 80 cm-by-72 cm is made into an open box (i.e. there's no top), by cutting x-cm…

A: The term "maximization" refers to the act of increasing the amount, size, or significance of…

Q: A monopoly producing a chip at a marginal cost of $4 per unit faces a demand elasticity of -3. Which…

A: Monopoly refers to the market condition in which only a single seller dominated the whole market.…

Q: Jana withdraws $1,200 in cash from her checking account. If the reserve requirement is 0%, but…

A: Money supply refers to the money flow in the market. Here change can be reflected with the help of…

Q: Consider the following IS-LM-BP model: IS Model: C = 250 +0.5(YT); T = 110+ 0.11Y; I= 150+ 0.35Y -…

Q: The following question relates only to the equilibrium in the goods market IN A CLOSED ECONOMY and…

A: Introduction The simple keynsian model is the keynsian economic model in a closed economy framework.…

Q: Transformational Leadership views effective leaders as agents of change. Explain how she…

A: It is possible to influence societal systems and individual behaviour through transformational…

Q: (d)_(Cournot Competition) Now suppose we added a second firm that has identical costs to the…

A: Dead weigh loss: It is defined as the loss of total welfare (or the total surplus = consumer surplus…

Q: 10. Suppose we have a pure exchange economy with two goods. There are two consumers (named A and B)…

Q: PART. Use the following information to answer all questions: the demand curve D(x)=-x² +8x+9, the…

A: Total revenue is the product of price and quantity. Profit is the difference between total revenue…

Q: The demand for hamburgers is given by Qd=10-p and the supply is Qs=4p-10, where pd and ps are,…

A: Provided information: According to the data given in the question, The demand function for…

Q: Graph the demand functions of the two goods (price as a function of quantity) assuming the…

Q: What is this market structure that allow firms to produce the amount of the goods consistent with…

A: An allocative efficiency refers to an ability to fulfil demand of consumer by distributing the…

Q: Use the following to answer the next question. Price 100 90 80 70 60 50 40 30 20 10 0- MCL MR₁ L…

A: In price leader ship model , there exist a follower and a leader .The leader decides the price at…

Q: If the marginal propensity to consume is 0.8, the value of the multiplier is: 5. 1.25.…

A: Marginal propensity to consume is the term used to describe the shift in income that occurs as a…

Q: The annual fixed costs for a plant are P 117447 and the variable cost per unit is P20 . The selling…

A: Given information: Fixed cost = 117447 Variable cost per unit = 20 Price per unit = 44.06…

Q: Which of these is a negative production externality? An airline manufacturer must hold up production…

A: Negative production externalities: When the production of goods and services cause harmful effect on…

Q: QUESTION 21 Corporations are carefully planned organizations, contrary to the common stereotypes.…

A: A corporation can be defined as a company that involves a group of people. Corporations are given…

Q: 55 50 45 40 35 30 25 20 15 10 O 50 10 20 30 40 50 60 70 80 90 100 The government imposes a price…

A: Producer surplus refers to the producer welfare; and will be computed as a difference between the…

Q: What's the meaning of "economies of scope"? A. producing at a higher output means incurring lower…

A: Businesses can often produce several products simultaneously or a single product at a time. This…

Q: A cash prize was invested 5 years and 5 months ago at 12% compounded semi-annually for a puzzle that…

A: Present value is is the value of investment in today's dollar. Future value is the value of…

Q: Text Question 1.5 The demand curve for a good is What is the elasticity at the point p = $10.00 and…

A: An elastic demand is one in which the change in quantity demanded due to a change in price is large.…

Q: Provide one example when the monopoly power leads to a dead weight loss, and one example when it…

A: When the monopolist is not able to discriminate in the market and charges a uniform price for the…

Q: The above figures show the market for gasoline. Which figure(s) shows the effect of an increased…

A: We have given the market for gasoline. The demand curve for gasoline depicts the inverse…

Q: The interest rate earned on an investment in an asset is called Group of answer choices a.…

A: An investment is an asset or item accrued determined to generate income or acknowledgment. In an…

Q: which of the following is not a type of dumping? O A. Pervasive. B. Persistent. C. Predatory. O D.…

A: When a nation exports a product in the foreign market at a price lower than the price at which it…

Q: It costs $750 per year to maintain a locker room. If the interest rate is 6.0%, how much must be set…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: Revenues Revenue from sales of goods and services. Operating costs and expenses: Cost of products…

A: Revenue from sales of goods = 80,000,000 Operating cost and expenses Cost of products and services…

Q: 2 3 4 5 6 1 7 5. Use the table below to answer the following questions: Quantity Demand (Price)…

A: Disclaimer: - Since you asked multipart question, we are solving only first 3 subparts as per…

Q: The economy shown here begins at a 0% output gap. Now suppose that banks begin to fear the risk of…

A: If banks begin to fear the risk of default and the risk premium rises by 2%, this could lead to a…

Q: The following question relates only to the equilibrium in the goods market IN A CLOSED ECONOMY and…

A: The international market is the market where a nation is involved in trade with multiple nations.…

Q: QUESTION 3 Which explains how the relative growth of the financial sector in the US has increased…

A: Unequal distribution of US incomes mean that the gap between poor and rich increases. The poor…

Q: why might managers of firms selling tires be more concerned about their companies reputation than…

A: Managers of firms selling tires be more concerned about their companies reputation than the managers…

Q: Which of the following statements is not true? Externalities are those costs arising from production…

A: "Since multiple questions have been asked by you , we will solve first question .Please specify the…

Q: A new vaccine offers protection against otitis media. Administering the vaccine to 10,000,000…

A: Cost-benefit analysis is one economic evaluation tool for comparing the costs and results of…

Q: monopolist Suppose that the discriminating has two independent demand curves Q1= 100-0.5p1,…

A: Price discrimination is said to exist when the monopolist charges different consumers with different…

Q: WHAT IS THE U.S. UNEMPLOYMENT RATE FOR NOVEMBER 2022? YOUR ANSWER: ___________%_.

A: Unemployment rate gives the percentage of unemployed people from the total workforce

Q: A bakery has an average fixed cost per bun of $1 and average variable cost of $1.60 at current…

A: The short run is the period of time when there are both fixed and variable factors. Variable Cost…

Q: Under conditions of the Coase Theorem, whether one or the other of two parties to a conflict over…

A: An efficient set of inputs and outputs will be chosen in fully competitive markets with no…

Q: Which of the following is a characteristic of monopoly? Average costs are always at a minimum High…

A: A monopoly is a sole company that generates and sells a product or service that has no close…

Q: The firm maximizes his profit when MR = MC. Under the oligopolistic market, the profit maximization…

A: In a market, a profit-maximizing firm will produce an output at a point where its marginal cost…

Q: Which of the following externalities represents the disruption to local tradersâ profits of an…

A: In economics the externalities refers to an unpriced products involved in either producer or…

Q: A person is planning to deposit RO 1000 in a bank at the end of first year. Thereafter, he wishes to…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: (e) For the income and prices in (b), what is optimal X, Y, and utility? Show your work.< (f)…

A: Compensating variation: When the price of a good changes and hence the consumption bundle, that new…

Q: Lafayette Group (U.S.). The Lafayette Group, a private equity firm headquartered in Boston, borrows…

A: When a currency depreciates, it loses worth in comparison to the currencies of other nations. There…

Question

The nominal GDP for 2021 is $125 billion, and the real GDP for 2021 is $100 billion.

(1). Calculate the GDP Deflator in 2021? Show your calculation.

(2). Also assume that the GDP deflator in 2020 was 100. What is the inflation rate over the 1-year period? Show your
calculation.

Definition Video Definition Overall monetary value of all the complete or final services and goods that a country can produce within its domestic boundaries in a specific period. Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

INTRODUCTION

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

A consumer expenditure survey reports the following information on consumer spending: 2020 2021 Price Quantity Price Quantity Product (1) $10 7 $10 7 Product (2) $6 10 $8 12 Product (3) $12 5 $14 10 a) Using 2020 as the base year, by how much does a "cost of products" index increase between 2020 and 2021? b) Calculate the inflation rate between 2020 and 2021, using the CPI you calculated in (a)
Nominal GDP in the United States was $20.3 trillion in 2018 and $21.2 trillion in 2019 If the inflation rate in 2018-2019 was approximately 2%, real GDP increased by approximately 1.5% 24% 3.7% 4.3%.
Quantity Quantity Item (2018) Price (2018) (2019) Price (2019) Magazines 400 $5.00 450 $4.50 Movie tickets 50 $6.00 200 $8.00 Pizzas 100 $10.00 120 $10.50 The data in the table above shows the consumption by families in an economy. The year 2018 is the reference base period. Based on the table above, between 2018 and 2019, the inflation rate in this country was 2.5 percent. 98.5 percent. -1.5 percent. 105.1 percent. -2.5 percent.
The steps involved in calculating the consumer price index, in order, are as follows: * Choose a base year, fix the basket, compute the inflation rate, compute the basket's cost, and compute the index. Choose a base year, find the prices, fix the basket, compute the basket's cost, and compute the index. Fix the basket, find the prices, compute the basket's cost, choose a base year and compute the index. Fix the basket, find the prices, compute the inflation rate, choose a base year and compute the index.
Suppose in the 1982 base year a typical market basket purchased by an urban family cost $250. In 1996, the same market basket cost $1,000. The same market basket also cost $950 in 1995. A) What is the consumer price index (CPI) for 1996? B) What is the consumer price index (CPI) for 1995? C) What was the annual rate of inflation for 1996? d) Answer the Question in detail on the image provided
For country A: CPI March 2021 is 523.5, and CPI April 2021 is 532.5. For country B: CPI March 2021 is 264.8, and CPI April 2021 is 266.8. We can say that The inflation rate in April was 1.7% in country A and 0.8% in country B. In April country A has a higher inflation rate than country B because the CPI increased by 9 points for country A and CPI increased by 2 points in country B. The overall price level in country A is approximately twice the overall price level in country B, because country A's CPI is almost two times the CPI of country B. In both March and April country A has a higher inflation rate than country B because for both months CPI is country A is higher than the CPI in country B.
1) If nominal GDP is $7636.0 billion and the GDP deflator is 130.2, then what is real GDP? 2) If the Consumer Price Index rose from 166.3 in 1985 to 380.1 in 2010, what would be the inflation rate over this period?
Question 11 of 25, Step 1 of 1 T A basket of goods and services is used to calculate the consumer price index (CPI) in Country A. The weight of food and beverages is 10% of the whole basket. The average household's budget on food and beverages was $7,500 in 2010 (base year) and increased by $500 in 2015. Assuming the increase in the rate of spending on food and beverages matched the inflation rate, calculate the inflation rate between 2010 and 2015. Round your answer to two decimal places if necessary.
"The cost of an average ticket to a baseball game in 1955 was $2.19. In 2010, the average price of a baseball ticket was $29.61. If the ticket price in 1955 rose at the same rate as inflation, what is the difference in prices between the 1955 ticket price (in 2010 dollars) and the actual ticket price in 2010? Enter your answer as a positive number. Refer to the instructions in the quiz for a link to the CPI table to answer this question."
If the Consumers Price Index in March 2016 was 1,125 and it was 1,154 in March 2017, this indicates that real GDP grew more quickly than nominal GDP in the year to March 2017. the inflation rate between these years was 2.6% (to 1 d.p.). on average, consumer prices did not change. the economy experienced deflation (on an annual basis).
A country’s nominal GDP rose from 600B to 770B while its real GDP rose from 500B to 550B. Calculate this country’s inflation rate (percentage change in GDP deflator values). 16.7% 10.2% 13.8% 19.6% 18.1%
Setting 2018 as the base year Using the consumer price index a). Calculate the inflation rate between 2018 and 2019 b)Determine the purchasing power of the Ghana Cedi in 2019 and interpret it