The country of Fishland had a GDP of 1,000 doubloons (the monetary unit)in 2003 and 1,500 doubloons in 2004.The GDP price index was 100 in 2003 and 150 in 2004.Between 2003 and 2004 real GDP in Irishland

Question

Quizplus · Accepted Answer

The real GDP is calculated by adjusting nominal GDP for inflation using the GDP price index. In 2003, the real GDP is 1,000 doubloons (since the price index is 100). In 2004, the real GDP is 1,500 doubloons / 1.5 (price index of 150) = 1,000 doubloons. Therefore, the real GDP remained the same.

The Country of Fishland Had a GDP of 1,000 Doubloons