Question

Question 10 (4 points) Between 2013 and 2014, the economy experienced a growth rate of 1.8% in real GDP per capita. If nominal GDP had increased by 3% and the population growth rate was 1%, then the annual inflation rate would be a) 0.2% Ob) - 1.2% OC) 1.2% d) 2% Question 11 (8 points) Before Great Recession in 2008-9, unemployment rate in U.S. was 4%. At the end of 2009, unemployment rate in U.S. was 9.9 percent and labor force participation rate was 63 percent. In mid 2010, unemployment rate was still at 9.9 percent, however, labor force participation rate went up to 65.2 percent е п

Answer 1

Nominal GDP growth rate = Real GDP per capital growth rate + Population growth rate + Inflation rate

3% = 1.8% + 1% + Annual Inflation rate

Annual Inflation rate = 0.2% (Option A is correct!!)

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