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ECON3102 Tutorial 01 - Week 2
1. Comparison across time:
Suppose these are the prices (in US dollars) and quantities of goods A and B produced in the US in 2017 and 2018:
|
|
pA |
qA |
pB |
qB |
|
2017 |
4 |
5 |
3 |
3 |
|
2018 |
1 |
10 |
4 |
2 |
(a) What was nominal GDP in 2017?
(b) What was nominal GDP in 2018?
(c) What was real GDP in 2018 at 2017 prices (computed using fixed 2017 prices)? Using this measure, how much did GDP grow between 2017 and 2018?
(d) What was real GDP in 2017 at 2018 prices (computed using fixed 2018 prices)? Us- ing this measure, how much did GDP grow between 2017 and 2018? What explains the difference between the two measures?
(e) How much did GDP grow between 2017 and 2018 using the chain-weighted method?
Comparison across countries:
In Thailand, prices (in Thai baht) and quantities in 2017 were:
|
|
pA |
qA |
pB |
qB |
|
2017 |
30 |
1 |
10 |
2 |
(f) What was nominal GDP in Thailand in 2017, expressed in baht.
(g) Suppose the exchange rate in 2017 was 25 baht per dollar. What was GDP in Thai- land in 2017, expressed in US dollars at market exchange rates?
(h) What was GDP in Thailand in 2017 at PPP? What accounts for the difference be- tween the market exchange rate measure and the PPP measure?
(i) What was the PPP exchange rate between the baht and the dollar?
2. Chained GDP: across time:
The country of Fructus produces Apples, Bananas and Cherries. Its production statistics are given in the spreadsheet.
Please download the spreadsheet in wattle.
(a) Compute a real GDP series at year-2000 prices using base year prices and using the chained method.
(b) Plot both series and comment on any differences.
(c) What was the average growth rate according to each method?
3. Math Review