Question

GDP Inflation DtorGDP GDP | %GDP | Real GDP | %RGDP 160p Rate YEAR CP (%CPI) Defator 2012-1 L00 |(2015-100) 2012 231.22 95.43 16197 le19 7 2013 234.72 522/0. yor103-6789 o4.738S 17522|4.34%|17 2014| 2015 237.830.ph 201ej 236.27|О.loby. | | 98.94 100.00 18219 242.79 2-08 y.| 24791| 2.11 % 1870102 (o8y1870 101.0 201 103.02 19485 1. Calculate the annual inflation rate using the CPI 2. Calculate the annual GDP growth rate using the GDP 3. Explain how the inflation rate and the GDP growth have bcen moved. 4. Calculate the real GDP using GDP deflator by setting 2012 as a base year. 5. Using the real GDP, calculate the real GDP growth rate. 6. Compare the nominal GDP growth rate vs. real GDP growth rate. Which one changes more and why? 7, Can you say that %Normal GDP %Real GDP+ Inflation Rate? Explain.

I need 5,6, and 7

Answer 1

5. Real GDP = $\small \frac{Nominal GDP}{Deflator}$ Real GDP growth rate =$\small \frac{RGDP_{2}-RGDP_{1}}{RGDP_{1}}X100$

YEAR	REAL GDP=$\tiny \frac{GDP}{DEFLATOR}$
2012	169.72
2013	172.84
2014	177.09
2015	182.19
2016	185.05
2017	189.13

YEAR	Real GDP growth rate
2012	-
2013	1.83%
2014	2.45%
2015	2.87%
2016	1.56%
2017	2.20%

6. The rate of change in nominal GDP is more than the growth rate of real GDP since nominal GDP is not adjusted to the rate of inflation and inflation is usually positive.

7. No, we cannot say that. Real GDP uses base year prices while nominal GDP uses current year prices thus the change in percentages cannot be equal .