Real and Nominal GDP
-Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.
A)95.5
B)123.5
C)118
D)104.7
E)116.6

Question

Real and Nominal GDP 
-Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.
A)95.5 
B)123.5 
C)118 
D)104.7 
E)116.6

Quizplus · Accepted Answer

To calculate the GDP deflator for year two, we divide nominal GDP in year two by real GDP in year two and multiply by 100. This gives us: (1250/1194) x 100 = 104.7. Therefore, the correct answer is D)104.7.