real gdp
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Title: real gdp

Essay Details:

Subject: Business
Author: Kristie T
Date: July 21, 2013
Level: University
Grade: A
Length: 3 / 624

Essay text:

Calculate the value of the price index for GDP for 2005 using 2004 as the base year. If we use 2004 as the base year we come up with the following calculations: GDP Deflator Base year 2004 2004 ($24000 Nominal 2004/ $24000 Real 2004 (base 2004)) x 100 = 100 2005 ($27840 Nominal 2005/ $25500 Real 2005 (base 2004)) x 100 = 109 By what percent did prices increase? The value of the price index for 2005 is 109. Because the GDP Deflator in 2005 is 109, and was 100 in the base year (2004) the increase in price is (109-100) /100 = 0.9 or 9%. 3. Now calculate the real GDP for 2004 and 2005 using 2005 prices...

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