ECONOMICS
ECONOMIC GROWTH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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If GDP increased from $3685 million to $3791 million in 1 year, what is the economic growth rate? (Note:the formula is the change divided by the original value, x 100.)
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2.87%
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3.42%
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1.84%
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2.35%
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Explanation:
Detailed explanation-1: -There are two ways to calculate the real economic growth rate. Real GDP can be calculated by taking the difference between the most recent year’s real GDP and the prior year’s real GDP. Then, divide this difference by the prior year’s real GDP.
Detailed explanation-2: -To calculate the real GDP growth rate, you will base your calculation on real GDP figures as shown below: Real GDP growth rate = (most recent years real GDP-the last years real GDP) / the previous years real GDP.
Detailed explanation-3: -Divide the nominal GDP by the GDP deflator and multiply by 100. This will give you the real GDP.
There is 1 question to complete.