ll ATT 1109 78 Question 2 Real GDP Assume that apples cost

.\'ll AT&T; 11:09 @ * 78% Question 2 Real GDP Assume that apples cost $0.50 in 2002 and $1 in 2009, whereas oranges cost $1 in 2002 and $1.50 in 2009. If 4 apples were produced in 2002 and 5 in 2009, whereas 3 oranges were produced in 2002 and 4 in 2009, then real GDP (in 2002 prices) in 2009 was: Multiple Choice A $5 B $6.50 C $9.50 D $11 Unanswered

Solution

Real GDP = Price in base year x Quantity in present year

Real GDP = 5 x 0.5 + 4 x 1 = $6.5

Option B is correct