Fill This Form To Receive Instant Help
Fill This Form To Receive Instant Help
Homework answers / question archive / C) Product Quantity Price Sweatshirts QTY: 50 PRICE: $35
C) Product Quantity Price
Sweatshirts QTY: 50 PRICE: $35.00
Dental examinations QTY: 40 PRICE $75.00
Coffee drinks QTY: 1000 PRICE: $4.00
Chewing gum QTY: 2000 PRICE: $0.50
Suppose that a simple economy produces only sweatshirts, dental examinations, coffee drinks, and chewing gum. Using the information in the above table, nominal GDP for this simple economy equals:
A) $7,250
B) $8,750
C) $9,750
D) None of these are correct
Computation of Nominal GDP:
Nominal GDP = (Price of Sweatshirt*Quantity of Sweatshirt) + (Price of Dental Examination*Quantity of Dental Examination) + (Price of Coffee Drinks*Quantity of Coffee Drinks) + (Price of Chewing Gum *Quantity of Chewing Gum)
= ($35*50) + ($75*40) + ($4*1,000) + ($0.50*2,000)
= $1,750 + $3,000 + $4,000 + $1,000
Nominal GDP = $9,750
