Suppose that, in year 1, an economy produces 100 golf balls that sell for $3 each and 75 pizzas that sell for $8 each. The next year, the economy produces 110 golf balls that sell for $3.25 each and 80 pizzas that sell for $9 each. Using year 1 as the base year, real GDP in year 2 is.

Explanation:

-In year 1,the per unit price of golf balls is $3 and the total production of golf balls is 100 and the price of each pizza is $8 with a total pizza production of 75.

-In year 2,the total production and per unit price of golf balls are 110 and $3.25 respectively and the total production and per unit price of pizzas are 80 and $9 respectively.

-Hence,based on the base year as year 1,the real GDP in year 2=

-Therefore,the real GDP in year 2,considering year 1 as base year is $970.

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