Based on the Data in the Table Below, Explain What

question 53

Essay

Based on the data in the table below, explain what happened to output and prices in the economy between 2009 and 2010. $$\begin{array} { l c c } & 2009 & 2010 \\\text { Nominal GDP (\$ billions) } & \$ 14,700 & \$ 15,200 \\\text { Real GDP (\$ billions 2000 chain weighted) } & \$ 12,100 & \$ 11,900\end{array}$$

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Definitions:

Internal Rate of Return

A financial metric used to evaluate the profitability of potential investments, representing the annual return rate that makes the net present value of cash flows from a potential investment equal to zero.

Capital Budgeting

The process businesses use to evaluate and select long-term investments that are expected to yield the most beneficial returns.

Widely Used

A term describing something that is extensively accepted or employed by a large number of people or in various areas.

Net Present Value

A method used in capital budgeting to evaluate the profitability of an investment by determining the difference between the present value of cash inflows and outflows.