a. Explain briefly what the consumer price index tries to measure? b. Describe three problems that make the consumer price index an imperfect measure of the cost of living. c. List two (2) differences between the consumer price index and the GDP deflator? d. Calculate the missing information in the table Year Real GDP Nominal GDP GDP Deflator Prices of Nutmeg ($per Nutmeg) Prices of Drapes ($ per Drapes) 2013 2700 70 10 8 2014 3600 100 12 9 2015 3600 4680 14 10 e. Distinguish between nominal GDP and real GDP?
a. Explain briefly what the consumer price index tries to measure? b. Describe three problems that make the consumer price index an imperfect measure of the cost of living. c. List two (2) differences between the consumer price index and the GDP deflator? d. Calculate the missing information in the table Year Real GDP Nominal GDP GDP Deflator Prices of Nutmeg ($per Nutmeg) Prices of Drapes ($ per Drapes) 2013 2700 70 10 8 2014 3600 100 12 9 2015 3600 4680 14 10 e. Distinguish between nominal GDP and real GDP?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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a. Explain briefly what the
b. Describe three problems that make the consumer price index an imperfect measure of the cost of living.
c. List two (2) differences between the consumer price index and the GDP deflator?
d. Calculate the missing information in the table
Year | Real GDP | Nominal GDP | GDP Deflator | Prices of Nutmeg ($per Nutmeg) | Prices of Drapes ($ per Drapes) |
2013 | 2700 | 70 | 10 | 8 | |
2014 | 3600 | 100 | 12 | 9 | |
2015 | 3600 | 4680 | 14 | 10 |
e. Distinguish between nominal GDP and real GDP?
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