For the following questions use the information in Table 10.1,which shows real GDP and potential real GDP for the years 2001-2010.
-According to the data in Table 10.1,about how much did short-run output fluctuations equal in 2001 and 2008,respectively?
A)-1.6%,1.1%
B)1.7%;-1.1%
C)101.6;147.2
D)-184.9;147.2
E)not enough information

Question

For the following questions use the information in Table 10.1,which shows real GDP and potential real GDP for the years 2001-2010. 
-According to the data in Table 10.1,about how much did short-run output fluctuations equal in 2001 and 2008,respectively?
A)-1.6%,1.1% 
B)1.7%;-1.1% 
C)101.6;147.2 
D)-184.9;147.2 
E)not enough information

Quizplus · Accepted Answer

To calculate the short-run output fluctuations for a given year, we must subtract the actual real GDP from the potential real GDP and divide the result by the potential real GDP. For 2001, short-run output fluctuations equal (-5.60 - (-3.09))/(-3.09) = -1.51/-3.09 = 0.49 or 1.7%. For 2008, short-run output fluctuations equal (13.42 - 12.31)/12.31 = 1.11 or -1.1%. Therefore, the answer is B.

For the Following Questions Use the Information in Table 10