Nominal GDP increased from roughly $15 trillion in 2010 to $21 trillion in 2020. In the same period, prices rose on average by roughly 17 percent. Instructions: Round your response to the nearest whole number. In percentage terms, real GDP increased by percent.
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- Businesses in the nation of Islandia have been accumulating cash because they have a pessimistic outlook of the national economy. Recent changes in the economic outlook of Islandia have caused business leaders to begin to invest some of their accumulated cash. Suppose that businesses in the country invest a total of $40 billion of this cash. Instructions: Enter a positive number to show an increase and a negative number to show a decrease. a. What would be the maximum expected change in GDP if Islandia's marginal propensity to consume (MPC) is 0.75? $ billion b. Suppose that the recent economic outlook in the country of Mountainia has been the opposite. Businesses have postponed planned investments and have begun to accumulate cash. If businesses in Mountainia postpone $12 billion of their planned investments, what would be the maximum expected change in GDP if its marginal propensity to save (MPS) is 0.05? $ billion1. Key facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1955 to the third quarter of 1959. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP). REAL GDP (Billions of dollars) 2800 2700 2600 2500 2400 1955 1956 1957 YEAR 1958 1959 ?recognize why economists believe that economic problems such as “shocks” and “sticky prices” are responsible for short-run fluctuations in GDP;
- If real GDP rises while nominal GDP falls, then prices on average have: risen. decreased and then been offset by an equal increase. stayed the same. fallen.If nominal GDP rises: real GDP must fall. real GDP must also rise. real GDP may either rise or fall. we can be certain that the price level has risen.Suppose GDP is 21.8 trillion and aggregate expenditures are 16.5 trillion. How does inventory change? Calculate the change in the level of inventory, if any. Provide your answer in dollars measured in trillions rounded to two decimal places. Use a negative sign"-" to indicate a decrease in inventory but do not include any other symbols, such as "S," "=" "%," or "," in your answer.
- Recessions hit parts of the economy differently. What part of the economy is usually hurt the most during a recession? Durable goods. Non-durable goods Consumer non-durable goods Consumer services like dentist appointmentsA futures market trades contracts on the growth rate for nominal GDP. The contract pays $X to the buyer, where X is 100 times the growth rate in nominal GDP from last year to this year. For example, if nominal GDP grows by 1% over last year, the contract pays $100 (1 x 100). Nominal GDP last year was $28,137 billion. Contracts on the futures markets are currently selling for $460. What is the market's prediction for nominal GDP this year? Put your answer in billions. You may round to two decimal places.1. Key facts about economic fluctuations The graph included below approximates United States business cycles between quarter one of 1947 and quarter three of 1951. The shaded region denotes periods of six or more consecutive months of declining real gross domestic product (real GDP). REAL GDP (Billions of dollars) 2170 2070 1970 1870 1770 1947 1948 1949 YEAR 1950 1951 ?
- An economy has nominal GDP of $16,768 billion in year 1 and $17,419 billion in year 2. If real GDP is $15,710 billion in 2019 and $16,086 billion in year 2, by how much did the price level rise between year 1 and year 2? Give your answer in percentage terms, not decimals. Round your answer to two deciman placeIf the government spending increases, will net exports (X-M) increase?What does it mean when the aggregate expenditure line crosses the 45-degree line? In other words, how would you explain the intersection in words?