Suppose that in 1984 the total output in a single-good economy was 7000 buckets of chicken. Also suppose that in 1984 each bucket of chicken was priced at $10. Finally, assume that in 2000 the price per bucket of chicken was $16 and that 22,000 buckets were produced. Determine the GDP price index for 1984, using 2000 as the base year. By what percentage did the price level, as measured by this index, rise between 1984 and 2000

GDP price index is 62.5, percentage price level rise is 60%.

Explanation: The GDP price index will be calculated by dividing the 1984 price by the 2000 price and multiplying by 100 thus:

10/16 X 100 = 62.5.

Therefore the GDP price index is 62.5.

To calculated percentage change using the price index, we have:

((100-62.5)/62.5) X 100

= (37.5/62.5) X 100

= 0.6 X 100

= 60%.

We can as well use another method:

((16-10)/10) X 100

= (6/10) X 100

= 0.6 X 100

= 60%

1   all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know