In 2015, Adanac Produced 20 Kilos of Apples and 30

Multiple Choice

In 2015, Adanac produced 20 kilos of apples and 30 kilos of bananas. Both fruits were used exclusively for final consumption and nothing else was produced. In 2015, a kilo of apples sold for $5 while a kilo of bananas sold for $10. In 2016, Adanac produced only 10 kilos of apples but produced 40 kilos of bananas. In 2016, prices were $6 per kilo of apples and $8 per kilo of bananas. Using 2015 prices, economists estimate that potential GDP is $500 in 2016. The output gap in 2016 is

A) - $50.
B) + $50.
C) - $100.
D) + $100.
E) - $120.