Question

Suppose GDP consists of eggs and ham. In 2002, 100 dozen eggs are sold at $3 per dozen, and 50 pounds of ham are sold at $4 per pound. If in 2001, the base year, eggs sold at $1.50 per dozen and ham sold at $5 per pound, nominal 2002 GDP is

Answer 1

Nominal GDP = $500

Step-by-step explanation:

Given the price of eggs in 2002 = $3

Quantity of eggs = 100 dozens

Price of ham in 2002 = $4

Quantity of ham = 50 pounds

Nominal GDP = Current year price x current year quantity

Nominal GDP = 100 x 3 + 50 x 4

Nominal GDP = 300 + 200

Nominal GDP = $500