Asked by Karina Goldberg on Jul 21, 2024
Verified
Refer to Table 23-3. What was the growth rate of real GDP for 1930?
A) ?8.62%.Real GDP is a better gauge of economic well-being than nominal GDP.
B) ?8.62%.Nominal GDP is a better gauge of economic well-being than real GDP.
C) ?9.43%.Real GDP is a better gauge of economic well-being than nominal GDP.
D) ?9.43%.Nominal GDP is a better gauge of economic well-being than real GDP.
Growth Rate
The measure of the increase in a particular variable, such as GDP or population size, over a specific period of time, usually expressed as a percentage.
Nominal GDP
The gross domestic product measured in current market prices, without adjustment for inflation.
- Discern between genuine and nominal values within economic indicators.
- Identify the effects of changes in GDP on a nation's economic health.
Verified Answer
DR
Deseree RileyJul 21, 2024
Final Answer :
A
Explanation :
The growth rate of real GDP for 1930 can be calculated using the formula: RealGDP1930−RealGDP1929RealGDP1929×100\frac{Real GDP_{1930} - Real GDP_{1929}}{Real GDP_{1929}} \times 100RealGDP1929RealGDP1930−RealGDP1929×100 . Substituting the given values: 892.8−977977×100=−8.62%\frac{892.8 - 977}{977} \times 100 = -8.62\%977892.8−977×100=−8.62% . Real GDP is a better gauge of economic well-being than nominal GDP because it accounts for changes in price levels, allowing for a more accurate comparison of economic output over time.
Learning Objectives
- Discern between genuine and nominal values within economic indicators.
- Identify the effects of changes in GDP on a nation's economic health.