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2 March, 06:21

Consider an economy that produces only DVDs and DVD players. Last year, 10 DVDs were sold at $20 each and 5 DVD players were sold at $100 each, while this year 15 DVDs were sold at $10 each and 10 DVD players were sold at $50 each. Nominal GDP this year is: $100. $500. $700. $650.

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Answers (2)
  1. 2 March, 06:40
    0
    Answer: The nominal GDP for this year is $650

    Explanation:

    Nominal gross domestic product measures the worth or value of all the goods and services that are produced or rendered by a nation at the products' or services' market price during a given year.

    Nominal gross domestic product is basically equal to the sum of the current year price * current year quantity of all the goods.

    Last year 10 DVDs were sold at $20 and 5 DVD players were sold at $100 therefore the nominal GDP for last year =

    ($20*10) + ($100*5)

    200 + 500

    = $700

    For this year, 15 DVDs were sold at $10 each and 10 DVD players were sold at $50 each, therefore the nominal GDP for this year=

    ($10*15) + ($50*10)

    = 150 + 500

    = $650

    Therefore the nominal GDP for this year is $650.
  2. 2 March, 06:42
    0
    D. $650

    Explanation:

    Given that

    15 DVDs sold at $10 = $150

    10 DVD player sold at $50 = 500

    Therefore,

    Nominal GDP this is the addition of the two goods produced, sold at market prices.

    Thus

    GDP = 150 + 500

    = $650
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