Gce Model Questions Vol1 2017 Economics Question 38

Practice objective / multiple choice question 38 from the 2017 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2017 Economics Objective / Multiple Choice Medium Difficulty
Question 38 GCE_MODEL_QUESTIONS_VOL1 • 2017 • ECONOMICS • objective

A country's export price index rises from 100 to 112 while its import price index falls from 100 to 96. Nominal GDP remains at \(\text{£}500\) billion. Calculate the percentage change in the terms of trade and the resulting percentage change in real GDP measured in import terms.

Answer Options

Correct Answer A. Terms of trade up 16.7 %; real GDP up 4.2 %
B. Terms of trade up 14.3 %; real GDP up 3.8 %
C. Terms of trade up 16.7 %; real GDP up 5.5 %
D. Terms of trade up 18.0 %; real GDP up 5.0 %
Correct Answer
A
Correct Option:
Terms of trade up 16.7 %; real GDP up 4.2 %

About This Question

This is Gce Model Questions Vol1 2017 Economics Question 38. It is one of the objective questions from the 2017 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

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