Questions: The economy of Britannica produces three goods: computers, Blu-rays, and pizza. The accompanying table shows the prices and output of the three goods for the years 2012, 2013, and 2014. Year Computers Price Computers Quantity Blu-rays Price Blu-rays Quantity Pizzas Price Pizzas Quantity --- --- --- --- --- --- --- 2012 900 10 10 100 15 2 2013 1,000 10.5 12 105 16 2 2014 1,050 12 14 110 17 3 Calculate nominal GDP in Britannica for each of the three years. Round answers to two places after the decimal point when applicable. 2012 nominal GDP: 2013 nominal GDP: 2014 nominal GDP: Calculate the percentage change in nominal GDP for 2012-2013 and 2013-2014. Round answers to two places after the decimal point when applicable. 2012-2013: % 2013-2014: %

The economy of Britannica produces three goods: computers, Blu-rays, and pizza. The accompanying table shows the prices and output of the three goods for the years 2012, 2013, and 2014.

Year Computers Price Computers Quantity Blu-rays Price Blu-rays Quantity Pizzas Price Pizzas Quantity
--- --- --- --- --- --- ---
2012 900 10 10 100 15 2
2013 1,000 10.5 12 105 16 2
2014 1,050 12 14 110 17 3

Calculate nominal GDP in Britannica for each of the three years. Round answers to two places after the decimal point when applicable.

2012 nominal GDP:

2013 nominal GDP:

2014 nominal GDP:

Calculate the percentage change in nominal GDP for 2012-2013 and 2013-2014. Round answers to two places after the decimal point when applicable.

2012-2013: %

2013-2014: %

Transcript text: The economy of Britannica produces three goods: computers, Blu-rays, and pizza. The accompanying table shows the prices and output of the three goods for the years 2012, 2013, and 2014. \begin{tabular}{lllllll} & \multicolumn{2}{l}{ Computers } & \multicolumn{2}{l}{ Blu-rays } & Pizzas \\ Year & Price & Quantity & Price & Quantity & Price & Quantity \\ 2012 & $\$ 900$ & 10 & $\$ 10$ & 100 & $\$ 15$ & 2 \\ 2013 & 1,000 & 10.5 & 12 & 105 & 16 & 2 \\ 2014 & 1,050 & 12 & 14 & 110 & 17 & 3 \end{tabular} Calculate nominal GDP in Britannica for each of the three years. Round answers to two places after the decimal point when applicable. 2012 nominal GDP: \$ 2013 nominal GDP: $\$$ 2014 nominal GDP: \$ Calculate the percentage change in nominal GDP for 2012-2013 and 2013-2014. Round answers to two places after the decimal point when applicable. 2012-2013: % 2013-2014: %

Solution

To calculate the nominal GDP for each year, we need to multiply the price of each good by its quantity and then sum these products for all goods.

Nominal GDP Calculation

2012:

Computers: $ \$900 \times 10 = \$9000 $
Blu-rays: $ \$10 \times 100 = \$1000 $
Pizzas: $ \$15 \times 2 = \$30 $

Total Nominal GDP for 2012: \[ \$9000 + \$1000 + \$30 = \$10030 \]

2013:

Computers: $ \$1000 \times 10.5 = \$10500 $
Blu-rays: $ \$12 \times 105 = \$1260 $
Pizzas: $ \$16 \times 2 = \$32 $

Total Nominal GDP for 2013: \[ \$10500 + \$1260 + \$32 = \$11892 \]

2014:

Computers: $ \$1050 \times 12 = \$12600 $
Blu-rays: $ \$14 \times 110 = \$1540 $
Pizzas: $ \$17 \times 3 = \$51 $

Total Nominal GDP for 2014: \[ \$12600 + \$1540 + \$51 = \$14291 \]

Percentage Change in Nominal GDP

2012-2013: \[ \text{Percentage Change} = \left( \frac{\text{Nominal GDP in 2013} - \text{Nominal GDP in 2012}}{\text{Nominal GDP in 2012}} \right) \times 100 \] \[ = \left( \frac{11892 - 10030}{10030} \right) \times 100 \] \[ = \left( \frac{1862}{10030} \right) \times 100 \] \[ = 18.56\% \]

2013-2014: \[ \text{Percentage Change} = \left( \frac{\text{Nominal GDP in 2014} - \text{Nominal GDP in 2013}}{\text{Nominal GDP in 2013}} \right) \times 100 \] \[ = \left( \frac{14291 - 11892}{11892} \right) \times 100 \] \[ = \left( \frac{2399}{11892} \right) \times 100 \] \[ = 20.17\% \]

Summary