Question

Table 23-6 (PLEASE ORGANIZE YOUR MATH WORK CAREFULLY and NEATLY) The table below contains data for the country of Batterland, which produces only waffles and pancakes. The base year is 2013. Prices and Quantities Price of Quantity of Quantity of Price of Pancakes Year Waffles Waffles Pancakes 2010 $2.00 $1.00 100 2011 $2.00 $2.00 120 2012 $2.00 120 $3.00 150 2013 $4.00 150 $3.00 200 80 100 4. Refer to Table 23-6. In 2012, this country's GDP deflator was a. 74.2. 100.0. 171.4. d. 240.0. od doo 690/930 *100 = 74.20 5. Refer to Table 23-6. This country's inflation rate from 2010 to 2011 was 1.38%. 38.20%. 138.20%. 41.90 deos

Needs to answer question 5 with providing an explanation

Answer 1

Base year =2013

4. Nominal GDP in 2012 = (2)(120)+(3)(150)= $690

Real GDP in 2012 = (4)(120)+(3)(150)= $930

GDP deflator in 2012= (Nominal GDP in 2012/ Real GDP in 2012)100= (690/930)100= 74.2

Hence, option(A) is correct.

5. Nominal GDP in 2010 = (2)(80)+(1)(100)= $260

Real GDP in 2010 = (4)(80)+(3)(100)= $620

GDP deflator in 2010 = (260/620)100= 41.94

Nominal GDP in 2011 = (2)(100)+ (2)(120)= $440

Real GDP in 2011 = (4)(100)+ (3)(120)=$760

GDP deflator in 2011 = (440/760)100= 57.9

Country's inflation rate from 2010 to 2011 = [(GDP deflator in 2011- GDP deflator in 2010)/GDP deflator in 2010]100

= [(57.9 - 41.94)/41.94]100= 38.2%

Hence, option(B) is correct.