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AP Macroeconomics 2.1 The Circular Flow and Gdp Questions

Understand GDP as final output and a flow of income and spending, then calculate nominal GDP from current prices and quantities.

Syllabus
Effective Fall 2022
Course
AP Macroeconomics

Exam points

  • decide whether domestic final production, inventories, services or transactions are included in GDP
  • calculate nominal GDP from current prices and quantities
  • calculate GDP with consumption, investment, government purchases and net exports
  • calculate a firm's value added without double counting intermediate inputs
  • interpret real and money flows between households and firms and relate total spending to total income

Covered syllabus points

MEA-1.A—a. Define (using the circular flow diagram as appropriate) how GDP is measured and its components. b. Calculate nominal GDP

Question 1

[Maximum number: 1]

The table provided shows the quantity and price of food and clothing, the only two goods produced and consumed in the country of Maltrose, in year 1 and year 2. Assume that year 1 is the base year.

Table for Question 1 — AP Macroeconomics

Calculate the nominal GDP in year 2. Show your work.

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