Calculate the following given the following information about an economy in 2007, 2008, and 2009:?

5. Calculate the following given the following information about an economy in 2007, 2008, and 2009:


2007 2008 2009





Nominal GDP (in billions of dollars) $1,730.6 $4,380.7 _____


GDP deflator (index, 1996=100) 44.2 80.6 107


Real GDP (in billions of 1996 dollars) ______ ______ 6,756.48





a. Nominal GDP in 2009._________


b. Real GDP in 1992 dollars in 2007 and 2008.__________


c. Rise in prices from 2007 to 2008. (Rate of inflation for 08)__________


d. Growth rate in 2009. Give a percent change. ______________|||GDP deflator = (nominal GDP/real GDP)*100





a.107 = (nominal/6756.48)*100


1.07*6756.48 = 7229.43





b. you mean in 1996 dollars?


2007: 0.442 = 1730.6/real


17360/0.442 = 39276.01


2008: 0.806 = 4380.7/real


real = 4380.7/0.806 = 5435.11





c. treating the GDP deflator of 2007 as the base


80.6/44.2 = (1+inflation) = 1.823 i.e. inflation of 82.3% or 0.823





d. using real GDP in 1996 dollars


1+growth rate = 2009's real/2008's real = 6756.48/5435.11 = 1.243 i.e. 24.3% or 0.243





I am not completely sure about c, but I think it's right. After all, the data implies the growth rate during that time was -86%. You bound to have some sort of major swing in inflation





Hope this helps