Question: Consider the table below for the economy of a nation whose economy produces five goods.
|
|
2006 |
|
|
2007 |
|
|
2008 |
| Good |
Price |
Quantity |
|
Price |
Quantity |
|
Price |
Quantity |
| Shampoo |
$2 |
15 |
|
$4 |
20 |
|
$6 |
25 |
| DVD Drives |
$200 |
10 |
|
$250 |
10 |
|
$255 |
15 |
| Books |
$40 |
5 |
|
$50 |
10 |
|
$60 |
20 |
| Milk |
$3 |
10 |
|
$4 |
12 |
|
$5 |
10 |
| Candy |
$1 |
40 |
|
$2 |
20 |
|
$3 |
27 |
Assume that 2007 is the base year.
A) Compute Nominal GDP for 2006, 2007, and 2008? Show ALL work.
B) What is Real GDP for 2006, 2007, and 2008? Show ALL work.
C) What is the Price Index for 2006, 2007, and 2008? Show ALL work.
D) What is the inflation between 2006 and 2007, then 2007 and 2008? Show ALL work.