Suppose that nominal GDP was $10000000.00 in 2005 in Orange County California. In 2015, nominal GDP was $11500000.00 in Orange County California. The price level rose 3.00% between 2005 and 2015, and population growth was 3.25%. Calculate the following figures for Orange County California between 2005 and 2015. Give all answers to two decimals.

Solution:

A) Nominal GDP Growth was:

($11500000.00 - $10000000.00) : $10000000.00 = 0.15 = 15%

B) Economic growth: 15% - 3.00% - 3.25% = 8.75%

C) Inflation: The %Δ price level is also known as inflation. So, in this case, inflation is 3.00%.

D) Real GDP growth : 15% - 3.00% = 12%

E) Per capita GDP growth: 15% - 3.25% = 11.75%

F) Real per capita GDP growth: 15% - 3.00% - 3.25% = 8.75%