Suppose in an economy where consumers buy only the 3 goods in the table below.D.CoffeePotatoBananaYearPricePricePrice$2$2$3$120182019$2$2Assume the market basket contains 90 potatoes, 30 coffees and 100 bananas. With 2018 asthe base year, use the CPI (consumer price index) method to calculate the inflation rate in2019.

(D) CPI is a tool that measures rise in the cost of a basket from base year to given year and is…

Answered: Suppose in an economy where consumers…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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In 1984 Michael Jordan got a contract with Nike that was worth $500,000 a year, for the next 5 years (1984-1988, inclusive). How much the contract would worth, year-by-year, if we express it in 2018 dollars? Use the following data for this calculation: Year 1984 1985 1986 1987 1988 2018 CPI 103.9 107.6 109.6 113.6 118.3 251.631
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The cost of a gallon of gasoline was $0.57 in 1975. If the cost of gasoline grew with inflation what would the cost be in 2021? How does this compare this to the actual cost of gasoline in 2021? Explain your answer using a meaningful sentence. CPI in 1975 was 53.8 CPI in 2021 was 270.97
4. Good X Y Z Quantity 10 20 5 Price in 1999 $5 $10 $6 Price in 2000 $6 $10 $10 Assume year 2000 is the base year. a) Calculate the market basket value for each year. What is the consumer price index in 1999? b) What is the inflation rate between 1999 and 2000?
Refer to the following table. Suppose the CPI basket consists of 10 pies of pizza and 20 bottles of milk respectively, and 2020 is the base year. Year Price of pizza Price of milk 2020 $250 $40 2021 $280 $45 а. Calculate the CPI in 2020 and 2021 respectively. What is the inflation rate in 2021? b. Suppose the minimum wage is $37.5 per hour in 2020, how much would it be in 2021 in order to maintain the same purchasing power in 2020?. С. Which one do you think is a better measure of a household's cost of living, CPI or GDP deflator? Why?*
Question 2 Part (a) Refer to the table below for a very simple economy producing three goods: education, pizzas and cars. Steel panels are needed for car production, cheese is necessary for making pizzas and projectors are used for educational service. Product Steel panels Education Cars Cheese Pizzas Projectors Quantity 40 400 400 2500 2500 4000 2017 Price $5000 $1000 $10000 $1.50 $9.00 $2000 Quantity 50 450 500 3500 3500 5000 2022 Price $6000 $1100 $12000 $1.50 $12.00 $3000 What is the nominal GDP for the economy in 2022? What was the nominal GDP in 2017? What is the real GDP in 2022 using 2017 prices as base year prices? What is the overall real GDP growth rate between 2022 and 2017? Part (b) Assume for an economy, there are 11.5 million people employed, unemployment rate is 5.2%, labor force participation rate is 64%, number of defence force personnel
Eco
5 eBook The table below lists the CPI values for the United States from different decades. a. Complete the table by computing the annual inflation rate. Instructions: Round your answers to two decimal places. If entering a negative number include a minus sign. CPI Values and Inflation Year 1931 1932 1933 1946 1947 1948 1978 1979 1980 2001 2002 2003 CPI 15.8 14.0 13.3 20.1 23.2 24.7 67.8 74.7 85.4 181.9 183.6 191.4 Inflation Rate (percent) % Instructions: Enter the year using all four numbers (yyyy). b. Using the table above, indicate the year the economy experienced: The highest annual inflation rate: The largest annual negative inflation (deflation) rate: [ The most stable price level (annual inflation rate closest to zero): [

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