Economic Analysis of the U.S. Economy: GDP Trends, Recession Impacts,and Unemployment Dynamics (1980–2015)1.From the National Income and Product Accounts, published by the BEA, downloadquarterlydata on nominal gross domestic product [Table1.1.5] and the implicit price deflator[Table 1.1.9] from 1980Q1-2015Q2. What is the formula for converting nominal to realGDP? Using that formula, construct a time series for real GDP. Then plot the series fornominaland real GDP on the same figure. Provide a legend and make your figurepresentable.Answer–The formula for converting nominal to real GDP is by dividing the nominal GDPwith that of the respective year’s price deflator.0.002000.004000.006000.008000.0010000.0012000.0014000.0016000.0018000.0020000.001980-01-011982-06-011984-11-011987-04-011989-09-011992-02-011994-07-011996-12-011999-05-012001-10-012004-03-012006-08-012009-01-012011-06-012013-11-01REAL GDPNOMINAL GDP VALUEPreview Mode
This document has 4 pages. Sign in to access the full document!