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Alex wants to measure the nominal 1998 GDP of $993 billion in 2008 dollars. From the data he gathered, he knows the deflator for 1998 is 30 and for 2008, it is 74, and that real interest in those years was 6.23% and 3.21% respectively. If he avoids making a misleading calculation, what will the value be?

Respuesta :

Manetho

Answer:

$2449

Explanation:

Alex wants to measure the nominal 1998 GDP of $993 billion in 2008 dollars.

Also the deflator for 1998 is 30 and for 2008, it is 74

Now he avoids making a misleading calculation

Therefore, the  the nominal 1998 GDP of $993 billion in 2008 dollars

= 993/30×74= $2449.4≅$2449

Tundexi

The value of the nominal 1998 GDP in 2008 dollars is $2,449 billion from $993 billion.

Here, we need to derive the nominal GDP value of $993 billion in 1998 in year 2008 dollars:

  • The formula will be [1998 Nominal GDP value * (GDP deflator in 2008 / GDP deflator in 1998)]

2008 Nominal GDP value = $993 billion*(74/30)

2008 Nominal GDP value = $993 billion * 2.4667

2008 Nominal GDP value = $2,449.43 billion

2008 Nominal GDP value = $2,449 billion.

Therefore, the value of the nominal 1998 GDP in 2008 dollars is $2,449 billion from $993 billion.

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