$$\begin{array} { c c c }
\hline \text { Year } & \text { Consumer price index } & \text { Nominal GDP } \
\hline 2001 & 100 & \$ 95 \text { billion } \
2002 & 105 & \$ 110 \text { billion } \
2003 & 110 & \$ 120 \text { billion } \
2004 & 120 & \$ 125 \text { billion } \
2005 & 132 & \$ 137.5 \text { billion } \
\hline
\end{array}$$
-Refer to the table in the exhibit.Between 2002 and 2003, what happened to real GDP for this nation?

Question

$$\begin{array} { c c c } 
\hline \text { Year } & \text { Consumer price index } & \text { Nominal GDP } \
\hline 2001 & 100 & \$ 95 \text { billion } \
2002 & 105 & \$ 110 \text { billion } \
2003 & 110 & \$ 120 \text { billion } \
2004 & 120 & \$ 125 \text { billion } \
2005 & 132 & \$ 137.5 \text { billion } \
\hline
\end{array}$$
-Refer to the table in the exhibit.Between 2002 and 2003, what happened to real GDP for this nation?

Quizplus · Accepted Answer

To calculate real GDP, we need to use the formula:
real GDP = (nominal GDP / price index) x 100
Using 2002 as the base year, we can calculate the real GDP for 2002 and 2003:
real GDP (2002) = (110 / 105) x 100 = \$104.76 billion
real GDP (2003) = (120 / 110) x 100 = \$109.09 billion
Therefore, real GDP increased by about \$4.33 billion between 2002 and 2003. The answer is D, "It increased by slightly more than $4 billion."

-Refer to the Table in the Exhibit