Scenario: A country produces only one good. It produced 5,000 units of the good during Year 1 and 6,000 units of the good in Year 2. The price of each unit of the good in Year 1 was $280 and it was $320 in Year 2. Suppose Year 1 is taken as the base year for the calculation of GDP.
-Refer to the scenario above.The nominal GDP of the country for Year 2 was ________.
A) $180,000
B) $1,920,000
C) $2,510,000
D) $174,000

Question

Quizplus · Accepted Answer

Nominal GDP for Year 2 is calculated by multiplying the quantity of goods produced in Year 2 by the price of goods in Year 2. So, 6,000 units * $320/unit = $1,920,000.

Scenario: a Country Produces Only One Good