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Growth Rates

Interactive Examples. Growth Rates. Begin. To navigate, please click the appropriate green buttons. (Do not use the arrows on your keyboard). Material from this presentation can be found in: Chapter 16. Slides By John Dawson and Kevin Brady. CoreEconomics, 2e. Interactive Examples.

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Growth Rates

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  1. Interactive Examples Growth Rates Begin To navigate, please click the appropriategreenbuttons. (Do not use the arrows on your keyboard) Material from this presentation can be found in: Chapter 16 Slides By John Dawson and Kevin Brady CoreEconomics, 2e

  2. Interactive Examples Growth Rates Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters A-E in the table to the appropriate numbers. Answer

  3. Interactive Examples Growth Rates Answer to Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters in the table to the appropriate numbers. Letter A: To find the real GDP, we must convert the nominal GDP using the GDP deflator. Real GDP = Nominal GDP x (Base Year Index / Current Year Index) Real GDP = $90 billion x (100 / 30) = $300 billion Answer Back to Table

  4. Interactive Examples Growth Rates Answer to Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters in the table to the appropriate numbers. Letter A: To find the real GDP, we must convert the nominal GDP using the GDP deflator. Real GDP = Nominal GDP x (Base Year Index / Current Year Index) Real GDP = $90 billion x (100 / 30) = $300 billion Letter B: To find the real GDP per capita, we must divide the real GDP by the population. Real GDP per Capita = $250 billion / 9.5 million = $26,316 Answer Back to Table

  5. Interactive Examples Growth Rates Answer to Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters in the table to the appropriate numbers. Letter A: To find the real GDP, we must convert the nominal GDP using the GDP deflator. Real GDP = Nominal GDP x (Base Year Index / Current Year Index) Real GDP = $90 billion x (100 / 30) = $300 billion Letter B: To find the real GDP per capita, we must divide the real GDP by the population. Real GDP per Capita = $250 billion / 9.5 million = $26,316 Letter C: To find the nominal GDP, we can use the formula used to solve for Letter A above. Real GDP = Nominal GDP x (Base Year Index / Current Year Index) $416.7 billion = Nominal GDP X (100 / 60) $416.7 billion = (10/6) x Nominal GDP Thus, Nominal GDP = $250 billion Answer Back to Table

  6. Interactive Examples Growth Rates Answer to Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters in the table to the appropriate numbers. Letter D: To find the population, we can use the real GDP per capita formula from the solution to Letter B. Real GDP per Capita = Real GDP / Population $42,860 = $642.9 billion / Population Solving for the population, we find it was 15 million. Answer Back to Table

  7. Interactive Examples Growth Rates Answer to Question 1: After conquering the academic world, you went on to start your own country! The partially completed table below shows some GDP statistics from your country. Change the letters in the table to the appropriate numbers. Letter D: To find the population, we can use the real GDP per capita formula from the solution to Letter B. Real GDP per Capita = Real GDP / Population $42,860 = $642.9 billion / Population Solving for the population, we find it was 15 million. Letter E: To find what the GDP deflator was in 2070, we can use the following formula: Real GDP = Nominal GDP x (Base Year Index / Current Year Index) $666.7 billion = $600 billion x (100 / Current Year Index) Solving for the Current Year Index, which is the GDP deflator in 2070, we find that it was 90. The completed table is on the next slide. Answer Back to Table

  8. Interactive Examples Growth Rates Question 1: Completed Table The End

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