Question

In an economy, Real GDP for year 2010 (base year = 2001)

is $400 billion and the GDP deflator 2010 (base year = 2001) is
110. Calculate the Nominal GDP for 2010.
$280 billion , $440 billion

Answer 1

The Nominal GDP for 2010 can be calculated by multiplying the Real GDP by the GDP deflator, which gives a value of $440 billion.

Step-by-step explanation:

The Nominal GDP for 2010 can be calculated using the formula:

Nominal GDP = Real GDP x GDP deflator

Given that the Real GDP for 2010 is $400 billion and the GDP deflator for 2010 is 110, we can substitute these values into the formula:

Nominal GDP = $400 billion x 110 = $440 billion

Therefore, the Nominal GDP for 2010 is $440 billion.