Economics

YEAR
QUANTITY
PRICECDtennis racquetCD pricetennis racquet price
2005
9018
018100
2006
10019
020110

Calculate real GDP for 2005 and 2006 using 2005 prices. By what percent did real GDP grow

REAL GDP

(9018)  (180100)  19620
(10018)  (190100)  20800

Growth of real GDP  20800-19620  19620 100  6

Calculate the value of the price index for GDP for 2006 using 2005 as the base year. By what percent did prices increase
Price Index 2006  2080019620100  110.1
Growth of Price  110.1  100100 100  10.1

Now calculate real GDP for 2005 and 2006 using 2006 prices. By what percent did real GDP grow

REAL GDP
(90200)(180110)  21600
(10020) (190110)  22900
Growth of Real GDP  22900-2160021600100  6
Annual Gross Domestic Product (2000-2009)

YearGDP20009,951.5200110,286.2200210,642.3200311,142.1200411,867.8200512,638.4200613,398.9200714,077.6200814,441.4200914,258.7

Given above is the date of U.S GDP figures from years 2000 to 2009. We will analyze the data with the aid of a graph.

Below is a line graph that shows the movement of the gdp. In the years 2000 to 2003, the U.S GDP is continuously increasing. 2001 was a remarkable year because a new president George W. Bush took the highest seat. He was very popular during his first term because he enacted many economic and health reforms. These can be assumed to have enlightened the economy of U.S, eventhough they faced the terror of the September 11 attack.

At this times, U.S also improved much on international trade specially with the overtake of Afghanistan and the seizure of Iraqi president Saddam Hussein. These have all increased American power around the world.

The 2007-2009 figures are low as the financial crisis hit the economy. The problem of subprime mortgage has backfired against many large U.S financial institutions, thus the graph shows a decline in the GDP figures from 2008 to 2009. This financial crisis was predicted by U.S economist Nouriel Roubini.