The GDP price index in the United States in 2000 was about 90, and real GDP in 2

Question

The GDP price index in the United States in 2000 was about 90, and real GDP in 2000 was $11.0 trillion (2005 dollars) The GDP price index in the United States in 2007 was about 106, and real GDP in 2007 was $13.0 trillion (2005 dollars) Calculate nominal GDP in 2000 and in 2007 and the percentage increase in nominal GDP between 2000 and 2007. >>> Answer below to 1 decimal place. Nominal GDP in 2000 is $trillion Nominal GDP in 2007 is $1-1 trillion. The percentage increase in the nominal GDP between 2000 and 2007 is percent.

Explanation / Answer

Answer

NGDP=(RGDP/100)*price index

NGDP in 2000=(11/100)*90=9.9 trillion

NGDP in 2007=(13/100)*106=13.8 trillion

the growth in NGDP=(NGDP in 2007-NGDP in 2000)/NGDP in 2000

=(13.78-9.9)/9.9=0.391919192

=39.2%

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