While the COVID-19 pandemic caused a decrease in U.S. GDP, it also caused a change in the combination of goods that were produced in the U.S. economy. Let's use a simple example to see what changed from Q1 of 2020, before the COVID-19 pandemic hit, to Q2 of 2020, the start of the pandemic.

2nd attempt

Part 1(2points)

See Hint

Consider an economy that produces two goods,face masksandpizzas, and a service, doctor visits. The economy also produces an input,cotton, used to makeface masks. The table below records the quantities of the goods and the input produced the quarter before COVID-19 and the first quarter of the COVID-19 pandemic. All data are in thousands.

Good and Input Produced	Quantities in Q1 2020	Quantities in Q2 2020
face masks	1,800.00	2,700.00
cotton	360.00	810.00
pizzas	45,000.00	22,500.00
doctor visits	400.00	380.00

The table below reports the prices of the two goods and doctor visits and the price of the input for each period.

Good and Input Produced	Prices in Q1 2020	Prices in Q2 2020
face masks	$100	$110.00
cotton	$40	$50.00
pizzas	$8.00	$6.00
doctor visits	$120.00	$100.00

(a) Nominal GDP in Q1 2020 was $ thousand. (b) Nominal GDP in Q2 2020 was $ thousand.

Part 2(2points)

See Hint

Assume Q1 2020 is the base period. Real GDP in that quarter is $ , and real GDP in the next quarter was $ .