MINDTAP Homework (Ch 23) 4. Measuring GDP The following table shows data on cons

Question

MINDTAP Homework (Ch 23) 4. Measuring GDP The following table shows data on consumption, investments, exports, imports, and governnme published by the Bureau of Economic Analysis. All figures are in billions of dollars. Fill in the missing cells in the table to calculate GDP using the expenditure approach. Data Consumption (C) Investment (I) Exports (X) Imports (M) Net Exports of Goods and Services Government Purchases (G) Gross Domestic Product (GDP) (Billions of dollars) 10,215.7 1,737.3 1,844.4 2,356.1 3,057.5 Type here to search 010 e

Explanation / Answer

We have C + I + G + NX = GDP

10215.70 + 1737.30 + (1844.40 - 2356.10) + 3057.50 = GDP

GDP = 14498.80

Also net exports = (1844.40 - 2356.10) = -511.70

We know that Nominal GDP = given year's prices x given year's quantities. Real GDP has prices fixed for base year 2014. Deflator is the ratio of nominal and real GDP. Find the table below

See that from 2015 to 2016, the nominal GDP has risen and real GDP has fallen

Peas Oranges Nominal GDP Real GDP Deflator Year Price Quantity Price Quantity 2014 1 120 1 195 315 315 100 2015 2 130 4 195 1040 325 320 2016 4 130 4 145 1100 275 400

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