In 2017, a country's nominal GDP is $375 billion. In 2018, it rises to $500 billion. Between the two years, the price index rises from 100 to 125. What was the percentage increase in real GDP?
Added by Carol M.
Step 1
Real GDP is calculated by dividing nominal GDP by the price index (expressed as a decimal). The formula is: \[ \text{Real GDP} = \frac{\text{Nominal GDP}}{\text{Price Index}} \] Show more…
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