Question

Consider the following data on U.S. GDP:

Year GDP
(Billions of current dollars) (Billions of 2012 dollars)
2014 17,521.7 16,899.8
2015 18,219.3 17,386.7
2016 18,707.2 17,659.2
2017 19,485.4 18,050.7
2018 20,494.1 18,566.4


The percentage change in nominal GDP from 2016 to 2017 was:_________
The percentage change in real GDP from 2014 to 2015 was__________

The percentage change in real GDP from 2014 to 2015 was higher than the percentage change in real GDP from 2015 to 2016.

a. True
b. False

Answer 1

A. 4.16%

B. 2.88%

C. True

Step-by-step explanation:

A. Calculation for The percentage change in nominal GDP from 2016 to 2017

Change in nominal GDP from 2016 to 2017

Change in nominal GDP= 19,485.4 / 18,707.2- 1

= 4.16%

B. Calculation for The percentage change in real GDP from 2014 to 2015

The percentage change in real GDP from 2014 to 2015

Percentage change in real GDP= 17,386.7 / 16,899 .8 - 1

Percentage change in real GDP= 0.0288 *100

Percentage change in real GDP= 2.88%

Calculation for percentage change in real GDP from 2015 to 2016 .

percentage change in real GDP= 17,659.2 / 17,386.7 - 1

percentage change in real GDP= 1.57%

TRUE The percentage change in real GDP from 2014 to 2015 which is 2.88% was higher than the percentage change in real GDP from 2015 to 2016 which is 1.57%