Table 12-18 A Very Simple Economy Produces Three Goods: Cameras, Legal Services

question 166

Multiple Choice

Table 12-18
$\begin{array}{|c|c|c|c|c|}\hline & 2013 & & 2018 & \\\hline \text { Product } & \text { Quantity } & \text { Price } & \text { Quantity } & \text { Price } \\\hline \text { Camera } & 100 & \$ 10 & 120 & \$ 12 \\\hline \text { Legal services } & 50 & 15 & 45 & 20 \\\hline \text { Books } & 200 & 40 & 210 & 45 \\\hline\end{array}$ A very simple economy produces three goods: cameras, legal services, and books. The quantities produced and their corresponding prices for 2013 and 2018 are shown in the table above.
-Refer to Table 12-18.What is real GDP in 2018,using 2018 as the base year?

• A) $28,885
• B) $11,790
• C) $11,200
• D) $10,275

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Definitions:

Risk-free Asset

An investment that is expected to return its full original value along with a specified interest rate with virtually no risk of financial loss.

Beta

An evaluation of the unsteadiness, or systematic jeopardy, of a security or collective financial investments when compared to the market as a whole.

CAPM

The Capital Asset Pricing Model, a formula used to determine the theoretical expected return of an investment given its risk relative to the market.