Following data shows the quantity produced and their respective market prices of two goods A and B that a hypothetical economy produces: Year Output…
BBA Macro Economics · 2023 · Solved Question with Answer
Following data shows the quantity produced and their respective market prices of two goods A and B that a hypothetical economy produces:
| Year | Output of A | Price of A (Rs) | Output of B | Price of B (Rs) |
| 2019 | 450 | 2,000 | 1,500 | 25 |
| 2020 | 470 | 2,200 | 1,200 | 30 |
| 2021 | 470 | 2,300 | 1,400 | 30 |
| 2022 | 480 | 2,100 | 1,700 | 35 |
a. Compute nominal GDP, real GDP, GDP Deflator and rate of inflation.
b. Why the real GDP is better measurement of welfare than nominal GDP?