Name:_____________________________

Quiz 6 - Economics 121

Prof. A. D. Becker

Pledge: I pledge my honor that during this quiz I neither gave nor received assistance and that I saw no dishonest work.

Signed: _____________________________

Below are the latest annual figures on U.S. economic output from the Bureau of Economic Analysis. All measures are in billions of (nominal) dollars. Use the back of this page for scratch work. Do show your work.

Aggregate Measure
1995 Nominal Value
1996 Nominal Value
GDP (Y)
7524
7576
Consumption (C)
4925
5152
Investment (I)
1116
Government Purchases (G)
1358
1407
Exports (X)
855
Imports (Im)
902
954
Net Exports (NX)
-96
-99
Price Index (base year =1992)

(Price Deflator)

107.6
109.7

Using the price index given, calculate the value of GDP in real dollars for both 1995 and 1996.

1995 Real GDP
1996 Real GDP


Calculate the inflation rate between 1995 and 1996 using the price index given.

1995 Real GDP
1996 Real GDP


Calculate the amounts of investment (I) and exports (X) for 1995.

1995 Real GDP
1996 Real GDP


A house was built in 1940 for $10,000. In 1988, that house sold for $120,000 and today it sells for $220,000. In 1940 the CPI was 14, in 1988 it was 118.3, and today it is 159.6 (CPI base years are 1982-84). During which year -- 1940, 1988, or 1997 -- did (does) the house have the highest price in today's dollars? Explain

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