4. Suppose the nominal gross national product of Ethiopia in 2010 and 2011 together with the GNP deflator are specified as follows:
Year Nominal GNP (in dollar) GNP deflator (price index)
2010 8,000,000,000,000 100
2011 10,000,000,000,000 200
Direction: Based on information provided above, answer questions that follow:
A. Compute the Real GNP of Ethiopia both for the years 2010 and 2011.
B. Determine the percentage (%) increase in Nominal GNP in 2011.
C. Determine the percentage (%) increase in Real GNP in 2011.
D. In which year there is higher inflation based on the above information? Why?
Inflation is higher in 2011 because real GNP is lower
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