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Macroeconomics

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Moderate

Calculating Nominal, Real GDP and the GDP Deflator

MACRO-ZSOJSK

Consider the following table which contains data on prices and production for the economy of Waine. Prices are measued in dollars and production is measured in billions of bushels.

Prices Quantity
2014 2015 2014 2015
Flax Seed 1.5 1.6 20 25
Blueberries 2.75 3.25 55 60

Nominal GDP in Waine in 2015 was

and real GDP in 2015 (assuming the base year is 2014) was

. Thus, the GDP deflator in 2015 must be

.