Consider a simple economy that produces two goods: apples and muffins. The following table shows the prices and quantiti

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Consider A Simple Economy That Produces Two Goods Apples And Muffins The Following Table Shows The Prices And Quantiti 1 (29.02 KiB) Viewed 87 times

Consider a simple economy that produces two goods: apples and muffins. The following table shows the prices and quantities of the goods over a three-year period. Apples Muffins Price Quantity Price Quantity Year (Dollars per apple) (Number of apples) (Dollars per muffin) (Number of muffins) 2018 2 125 3 155 2019 4 135 3 210 2020 2 125 3 165 Use the information from the preceding table to fill in the following table. Nominal GDP Real GDP Year (Dollars) (Base year 2018, dollars) GDP Deflator 2018 2019 2020 From 2019 to 2020, nominal GDP and real GDP The inflation rate in 2020 was Why is real GDP a more accurate measure of an economy's production than nominal GDP? Nominal GDP is adjusted for the effects of inflation or deflation, whereas real GDP is not. Real GDP does not include the value of intermediate goods and services, but nominal GDP does. Real GDP is not influenced by price changes, but nominal GDP is.