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How much more output does the $15 trillion U.S. economy produce when GDP increases by...

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gabygar | eNotes Newbie

Posted October 10, 2013 at 12:58 AM via web

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How much more output does the $15 trillion U.S. economy produce when GDP increases by 1.5 percent

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted October 12, 2013 at 4:25 PM (Answer #1)

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All that you are being asked to do in this question is to figure out a percentage.  The size of the US economy does not matter here.  It is also not really important for you to even know what gross domestic product (GDP) is.  All you are being asked is to determine how much larger the economy would be if it increased by 1.5%.

So, what you have to do here is to figure out what 1.5% of 15 trillion is.  To find this, you must first express 1.5% as a decimal.  You move the decimal point two places to the left and you have .015.  Now, you multiply .015 by 15.  The product of that operation is .225.  That means that the US economy will produce $.225 trillion more than it did before.  This can also be expressed as $225 billion. 

So, if the US economy starts out at $15 trillion and increases by 1.5%, its output increases by $225 billion. 

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