Consider a Small Country Producing Only Two Commodities (Coffee Beans

Consider a small country producing only two commodities (coffee beans and corn) . Following are the price and output of these two commodities in the year 2008:
$\begin{array}{|l|l|}\hline \text { Price } & \text { Quantity } \\\hline \$ 12 & 500 \mathrm{lbs} \text {. of coffee beans } \\\hline \$ 6 & 600 \text { bushels of corn } \\\hline\end{array}$
Assuming that the output of these two commodities remains constant, while the price of each rises by 10 percent in 2009, compute the value of real GDP in 2009.

A) $12,000
B) $10,560
C) $9,600
D) $8,400
E) $6,560

Correct Answer:

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