suppose US nominal GDP was $6,250 billion in 2000 and GDP chain price index is 125.0. Real GDP is:
To find the real GDP, we need to adjust the nominal GDP using the GDP chain price index. The formula to calculate real GDP is:
Real GDP = Nominal GDP / GDP chain price index
In this case, the nominal GDP in 2000 is given as $6,250 billion and the GDP chain price index is given as 125.0. Let's substitute these values into the formula:
Real GDP = 6,250 billion / 125
To simplify, we need to convert the nominal GDP from billions to units of dollars. Since 1 billion is equal to 1,000 billion, we can multiply the nominal GDP by 1,000:
Real GDP = (6,250 billion * 1,000) / 125
Real GDP = 6,250,000 billion / 125
Let's divide these numbers:
Real GDP = 50,000 billion
Therefore, the real GDP for the given data is $50,000 billion.
To calculate the real GDP, we need to use the GDP chain price index to adjust the nominal GDP. The formula to calculate real GDP is:
Real GDP = (Nominal GDP) / (GDP chain price index) * 100
Plugging in the given values, we have:
Real GDP = ($6,250 billion) / (125.0) * 100
Calculating this, the real GDP is $5,000 billion.