Question

The GDP deflator in the United States in 2014 was 104​, and real GDP in 2014(in 2012​ dollars) was ​$16.2 trillion. The GDP deflator in the United States in 2017 was 108​, and real GDP in 2017 ​(in 2012​ dollars) was ​$18.1 trillion. What was the percentage increase in production between 2014 and 2017​, and by what percentage did the price level rise between 2014 and 2017​?

The percentage change in production between 2014 and 2017 is ???? percent.

The change in the price level between 2014 and 2019 is ???? percent

Answer 1

1.

The percentage change in production between 2014 and 2017 is ???? percent.

Answer : 11.73 percent

Explanation :

Percentage change in output

=[( real gdp year 2-real gdp in year 1) /real gdp in year 1] ×100

=[(18.1-16.2)/16.2]×100

=[1.9/16.2]×100

=0.1173*100

=11.73%

2.

The change in the price level between 2014 and 2019 is ???? percent

Answer :3.85%

Explanation :

Price level =[(gdp deflator in year 2 - GDP deflator in year 1) /gdp deflator in year 1] ×100

=[(108-104)/104]×100

=[4/104]×100

=3.85%