Nominal GNP problem, The value of nominal GNP of an economy was Rs. 2,500 crores in a

Nominal GNP problem

The value of nominal GNP of an economy was Rs. 2,500 crores in a specific year. The value of GNP of that country throughout the same year, computed at the prices of some base year was Rs.3000 crores. Evaluate the value of GNP deflator of the year in terms of percentage. Has the price level increase between the base year and the year in consideration?

View Complete Question

Comments & Conversion

Expert

Verified

GNP deflator = Nominal GNP/Real GNP * 100
= 2500/3000 * 100 = 83.3%

No, the price level has not increase between the base year and the year in consideration. However, it has fallen.

Related Questions in Macroeconomics

Q : Define law of supply Law of supply : It

Law of supply: It is the claim which, other things equivalent, the quantity supplied of a good increases whenever the price of the good increases.

Q : Problem on rational consumption

Whenever you dine at an “all-you-can-eat” buffet, the rational consumption prototype is to carry on eating till: (1) The restaurant goes bankrupt. (2) You have eaten as much food as it would encompass cost had you made your own meal at hom

Q : Macroeconomics-fiscal and monetary

1) How can governments seek to control their national economies through fiscal and monetary policies?2) What are the causes of the fiscal deficits experienced by many developed nations in the past three years and what are the main effects

Q : Drawback in illustration of

Illustrations of macroeconomic aggregates would NOT consist of the: (1) tax responsibilities of a family. (2) unemployment rate. (3) level of national income. (4) supply of money. (5) rate of inflation. Can someone

Q : Assignment Task 1 – Commercial banks in

Task 1 – Commercial banks in United Economy have total deposits of AED 300 billion. Their reserves are AED 15 billion, two- thirds of which are with the Central Bank as deposits. There are AED 30 billion notes outside the banks. There are no coins! Calculate- a) The monetary base. b) The bank

Discover Q & A

Leading Solution Library

Avail More Than 1451788 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads

No hassle, Instant Access

Start Discovering

18,76,764

1933098
Asked

3,689

Active Tutors

1451788

Questions
Answered

Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

Submit Assignment