Chapter 8: Formulating GDP
1. Suppose the GDP deflator was 100 in 2008 and 95 in 2009. If nominal GDP
in 2009 was 1% smaller than in 2008, then the rate of real GDP growth in
2009 was:
A. -5.0 percent.
B. -4.0 percent.
C. 4.0 percent.
D. 5.0 percent.
2. In 2001, the national NOMINAL GDP was $2,000,000,000.
In 2006, the national NOMINAL GDP increased to $2,500,000,000.
The Consumer Price Index has increased from 110 in 2001 to 134 in 2006.
What is the REAL GDP (what real growth took place)?
(HINT: Find % change in Nominal GDP, then find % change in CPI)
3. Use the following information to compute NDP:
Exports
Imports
Gross Investment
Net foreign factor income
Government purchases
Government Transfer payments
Personal Consumption
Depreciation
20
45
55
35
35
30
70
15
4. If real GDP has increased by 3% and nominal GDP has increased by 5%,
then:
A. depreciation is 2%.
B. net factor income is 2%.
C. inflation is 2%.
D. net exports are 2%.
5. What is Real GDP if Nominal GDP rises from $10 trillion to $12 trillion and
the price level rises 10 percent? Does production increase or decrease?
6. If output increases by 5 percent and population growth is 3 percent, per
capita output:
A. grows by 2 percent.
B. grows by 3 percent.
C. grows by 5 percent.
D. grows by 8 percent.
7. If a country's population is 10 million and its GDP is $113 billion, its per
capita output is:
A. $113.
B. $1,130.
C. $11,300.
D. $113,000.
8. If the base year for CPI is 2005 when the GDP was $540 billion, and GDP in
2011 increased to $675 billion, what is the price index for 2011?
9. What is the growth rate formula?
10.What is the growth rate if the CPI in 2012 was 228.7 and the CPI in 2011
was 225.5?