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Essay Details:
Essay text:
Calculate the value of the price index for GDP for 2006 using 2005 as the base year
[(90 X 20) + (180 X 110)] / [(90 X 18) + (180 X 100)] X 100
[1,800 + 19,800 = 21,600] / [1,620 + 18,000 = 19,620]
21,600 / 19,620 = 1.10 X 100 = 110.09
2. By what percent did the price increase = 1.10%
Question Three
1. Calculate the real GDP for 2005 and 2006 using 2006 prices
2005:
(90 X 20) + (180 X 110) = 1,800 + 19,800 = 21,600
2006:
(100 X 20) + (190 X 110) = 2,000 + 20,900 = 22,900
2. By what percent did real GDP grow
22,900 ? 21,600 = 1,300 / 21,600 X 100 = 6.01%
Question Four
Using the Bureau of Economic Analysis website table 1...
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