Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Name _______________________________ AP Macro – Nominal v Real GDP Practice Worksheet K 2-2 1. Surprise GDP Review Will each of the following transactions be included in GDP for the United States? Briefly explain why/why not. a. McCraith Wholesale Beverages builds a new structure in New York Mills, NY b. Brianna Wilbur autographs a Price Chopper Advantage card and sells it for $35,000 to Elyse Muder c. Mary Magdalene Tehan buys an existing share of Disney stock d. Duffy Lemire builds 17 miniature dioramas of wigwams and sells them to a collector in Estonia e. Whilst travelling through the jungles of Nool, Brandon Newton buys Elvish turkey bacon that he mails back home to New Hartford f. After starting his own publishing company, Steve Rabbia prints 10 million copies of Greg Bello’s stirring autobiography, Who Moved My Cheese?; the book sells 2 copies. 2. Calculating Nominal and Real GDP, plus some Growth Rates In 2013, an economy produced only two goods, snarks and bens. It produced 100 snarks which sold for $2 each and 200 bens which sold for $3 each. In 2014, the same economy produced 150 snarks which sold for $3 each and 250 bens which sold for $4 each Calculate nominal GDP in both years Calculate the real GDP for both years, using 2013 prices Calculate the growth rate in real GDP from 2013 to 2014 The economy of Stappenbeckingham produces three goods: kazoos, ham and didgeridoos. The accompanying table shows the prices and output of the three goods for the years 2005, 2006 and 2007. Kazoos Year 2005 2006 2007 Price $900 $1,000 $1,050 Ham Quantity 10 10.5 12 Price $10 $12 $14 Quantity 100 105 110 Didgeridoos Price Quantity $15 2 $16 2 $17 3 a. What is the percent change in production of each of the goods from 2005 to 2006 and from 2006 to 2007? b. What is the percent change in prices of each of the goods from 2005 to 2006 and from 2006 to 2007? c. Calculate nominal GDP in Stappenbeckingham for each of the three years. What is the percent change in nominal GDP from 2005 to 2006 and from 2006 to 2007? d. Calculate real GDP in Stappenbeckingham using 2005 prices for each of the three years. What is the percent change in real GDP from 2005 to 2006 and from 2006 to 2007? 3. Multiple Choice Practice If prices in an economy are increasing but there is no change in the amount of goods and services being produced, what will happen to real GDP and nominal GDP? Change in rGDP Change in nominal GDP a. No change No change b. Increase Increase c. Increase Decrease d. No change Decrease e. No change Increase