Answer: Nominal GDP values production at current prices, whereas real GDP values production at constant prices.
Explanation;
Nominal GDP calculates the total output in the Economy based on the current prices of commodity which means that it will include inflation.
Real GDP on the other hand removes the effect of inflation by basing the GDP on the prices in a base year which is not usually the current year thereby eliminating the effect of inflation and using constant pricing. Real GDP is therefore better for comparison over the years.
Lyon need a different job I think. Cause that what’s 20thousa d less then what my mothers in law makes?
Answer:
the client should wait 10 more years until the contract is worth $180,000 since he will earn a slightly higher interest rate
Explanation:
we must determine the effective interest earned by the client if he accepts the company's proposal:
future value = present value x (1 + r)ⁿ
121,000 = 100,000 x (1 + r)⁵
(1 + r)⁵ = 121,000 / 100,000 = 1.21
⁵√(1 + r)⁵ = ⁵√1.21
1 + r = 1.0389
r = 0.0389 = 3.89%
if the client waits 10 more years until he is able to annuitize the account, he should earn:
180,000 = 100,000 x (1 + r)¹⁵
(1 + r)¹⁵ = 180,000 / 100,000 = 1.80
¹⁵√(1 + r)¹⁵ = ¹⁵√1.80
1 + r = 1.03996
r = 0.03996 = 4%
Yes it does because it helps us to be aware on the things that we should know on how to raise the animals with care.
