Question

cld-5697 Econ1101 Macro Principles-003 Sara Shanko & 9/19/19 1:49 PM Homework: Nominal vs Real GDP, PPP adjustment Save Score: 0.27 of 1 pt 10 of 19 (18 complete) HW Score: 63.35 % , 16.47 of 26 pts Text Problem 8 Question Help T-Shirts 90 $24 108 $24 Red Bull (cans) 480 $1 480 $2 Pizza (slices) 1040 $2 960 $4 Nominal GDP in 2011 was $ 4720 and nominal GDP in 2012 was $ 7392. (Enter your responses as intogers.) f 2011 is the base year, real GDP in 2011 was $ 4,720 and real GDP in 2012 was $ 4992. (Enter your responses as integers.) Based on your answer above, the percentage change in real GDP between 2011 and 2012 was 5.76 percent. (Round your response to two decimal places and use a minus sign if necessary.) and real GDP in 2012 was $ 7,392. (Enter your response0s as integers.) 2012 is the base year, real GDP in 2011 was $ 7,280 Based on your answer above, the percentage change in real GDP between 2011 and 2012 was 1.54 percent. (Round your response to two decimal places and use a mninus sign if necessary.) and the GDP deflator in 2012 was (Round your responses to one decimal place.) sing 2011 as the base year, the GDP deflator in 2011 was nter your answer in the edit fields and then click Check Answer. Final Check part remaining Clear All TO 19

Just the last question is needed please.

Answer 1

So, to find the GDP deflator, we will take 2011 as the base year

GDP Deflator for 2011 = (Nominal GDP of 2011/Real GDP of 2011) * 100

=(4720/4720)*100

= 100 (as the base price for inflation)

now, GDP Deflator for 2012 = (Nominal GDP of 2012/Real GDP of 2012)*100

= (7392/4992)*100

=148.07(ie 48% rise in inflation or GDP Deflator)