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A South Sea Island Produces Only Coconuts

Question 89

Multiple Choice

A south sea island produces only coconuts. In 2005, the price of a coconut is $2.00 and the quantity produced is 400. In 2012, the price of a coconut is $1.50 and the quantity produced is 350. 2005 is the reference base year. Real GDP in 2012 in terms of base-year prices is


A) $600.
B) $525.
C) $800.
D) $700.
E) $750.

Correct Answer:

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