ECON 201 UMUC GDP For Countries Data exercise #1 Assignment

University of Maryland University College

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1

Data Exercise
Name
Course
Professor
Date

DATA EXERCISE

2
Data Exercise
Part 1

a.
Nominal GDP Billion dollars

Real GDP Chained 2012
Dollars

Component

2018 Q4

2018 Q4

Government Consumption

3,569.4

3,188.7

Gross Domestic Product

20,865.1

18,765.3

Net Exports of goods and

-658.9

-955.7

3,766.3

3,467.3

14,188.4

13,032.3

expenditure and Gross
Investment

services
Gross Private Domestic
Investment
Personal Consumption
Expenditure

b.
Calculations using the Nominal GDP
Nominal GDP Billion dollars
Component

2018 Q4

x/Nominal GDP *100%

DATA EXERCISE

3

Gross Domestic Product

20,865.1

Government Consumption

3,569.4

17.1%

14,188.4

68.0%

3,766.3

18.1%

-658.9

-3.2%

expenditure and Gross
Investment
Personal Consumption
Expenditure
Gross Private Domestic
Investment
Net Exports of goods and
services

Calculations using the Real GDP
Real GDP Chained 2012

x/Real GDP *100%

Dollars
Component

2018 Q4

Gross Domestic Product

18,765.3

Personal Consumption

13,032.3

69.4%

3,467.3

18.5%

-955.7

-5.1%

Expenditure
Gross Private Domestic
Investment
Net Exports of goods and
services

DATA EXERCISE

Government Consumption

4

3,188.7

17.0%

expenditure and Gross
Investment

2.
The nominal GDP is higher than the real GDP in the data that we have in this case. One
of the reasons that can be used to explain this is if there is a change in the prices in a country.
The nominal GDP looks at how the economy is fairing in the current period without comparing it
with the previous data. We use the current prices of the goods and services and multiply with the
goods and services that the economy is producing. It only tells us the current value of the
services and goods that have been produced in an economy in that specific time (Argandoña,
2016). Nominal GDP does not tell us how we are faring as an economy compared with the other
years. This is the reason why people prefer to use real GDP as it gives us more information and
more details. The nominal GDP can raise just due to the fact that the prices have risen and the
production has not increased. Another reason for a higher nominal GDP is due to inflation. As
inflation is more common that deflation, we tend to have a higher nominal GDP than real GDP.
In our case, the real GDP is 18,765.3 billion dollars while the nominal GDP is 20,865....

CASIMIR (24455)
University of Virginia
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