22. Consider year 1 as the base year. If the # of goods in a Year 3 = 300 and 1 point the price per good in year 3 = $7, what is the REAL GDP in year 3? *
Nominal GDP - Current Production x Current Price
Real GDP = Current Production x Base Year Price
Example:
Year 1
Year 2
# of goods
100 goods
X
Price per good
$5 per good
$6
Nominal GDP
$500
$1,200
Real GDP
$500
$1,000
200
X
=
$1,000
$1,500
$2,100

The school cafeteria can make pizza for approximately $0.30 a slice. the cost of kitchen use and cafeteria staff runs about $200 per day. the pizza den nearby will deliver whole pizzas for $9.00 each. the cafeteria staff cuts the pizza into eight slices and serves them in the usual cafeteria line. with no cooking duties, the staff can be reduced by half, for a fixed cost of $75 per day. should the school cafeteria make or buy its pizzas?