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- The table below contains the price indexes for the macro economy for several years. Price Index 2010 - Base Year 100 2011 105 2012 130 2013 145 2014 140 Calculate the inflation that took place in 2013. Show the formula and all your calculations.The monthly market basket for consumers consists of pizza, t-shirts, and rent. The table below shows market basket quantities and prices for the base year (Year 1) and in the following year. Base Year (Year 1) Quantity 15 In Year 1, the CPI for the economy is In Year 2, the CPI for this economy is Product Pizza T-Shirts Rent 4 1 (Round both answers to one decimal place.) Price in the Base Year $2.00 $10.00 $500.00 Price in Year 2 $2.50 $9.00 $550.00Discuss how does the GDP relate to CPI, and how the GDP and CPI contribute toinflation. Write a short report with NO more than 400 words. You should relate the findings based on the line graphs of the GDP and CPI for Ethiopia and Germany, attached in the images.
- The market basket used to calculate the CPI in Aquilonia is 4 loaves of bread, 6 gallons of milk, 2 shirts and 2 pants. In 2001 bread cost $1.00 per loaf, milk cost $1.50 per gallon, shirts cost $6.00 each and pants cost $10.00 per pair. In 2002 bread cost $1.50 per loaf, milk cost $2.00 per gallon, shirts cost $7.00 each and pants cost $12.00 per pair. What was the inflation rate, as measured by the CPI, for Aquilonia between 2001 and 2002? a. 24.4 percent b. 21.6 percent c. It is impossible to determine without knowing the base year. d. 30 percentUse the information in the table to calculate a consumer price index (CPI) and the inflation rate. The base year is 1975. Round answer to two decimal places. Market basket Quantity 1975 prices 1976 prices A dozen eggs 21 $0.50 $0.90 Calculator 11 $10.50 $14.00 Microwave oven 2 $130.00 $150.00 What is the CPI for 1975? What is the CPI for 1976? What is the inflation rate for 1976?A Consumer Expenditure Survey in Sparta shows that people buy only juice and cloth. In 2015, the year of the Consumer Expenditure Survey and also the reference base year, the average household spent $27 on juice and $20 on cloth. The price of juice in 2015 was $3 a bottle, and the price of cloth was $5 a yard. In 2016, juice is $5 a bottle and cloth is $4 a yard. Calculate the CPI in 2016 and the inflation rate between 2015 and 2016. The CPI in 2016 is >>> Answer to 1 decimal place. The inflation rate between 2015 and 2016 is percent. >>> Answer to 1 decimal place. >>> If your answer is negative, include a minus sign. If your answer is positive, do not include a plus sign.
- Indexation is done using the CPI and is equivalent to measuring the real GDP. True O FalseConsider an economy where the consumers buy widgets, cogs, and services. The CPI market basket consists of 195 widgets, 378 cogs, and 869 services. We have the following prices for 2021 and 2022: Year Widget Cost Cogs Cost Services Cost 2021 119.84 57.04 25.75 2022 132.97 62.79 36.94 If the base year is 2022, what is the price index for 2021? Round your answer to two digits after the decimal.Which of the following statements about the CPI is true? How does the PCEPI differ from the CPI? The CPI _______. A. has a bias of approximately 2.0 percentage points a year B. is a measure of the change in the amount of money that people need to spend to achieve a given standard of living C. measures all the changes in the cost of living D. is a relatively useless measure because every year new goods become available and some old goods disappear The PCEPI _______. A. uses the same market basket as the CPI but gives a greater weight to sticky-price items B. introduces even more biases into the inflation rate than the CPI C. excludes the prices of food and energy D. uses the prices of goods and services included in the consumption expenditure component of GDP
- What is the Higher Education Price Index (HEPI), where does it fit in with the CPI and PPI, and how is the HEPI related to the CPI?What does the CPI means? a. The gross domestic product b. The labor force participation rate c. The changes in the price level d. The level of unemployment in a countryWhat information is given by the CPI? The CPI tells us _______. A. the price level in a given period expressed as a percentage of the price level in the base period, which equals zero B. the price level in a given period expressed as a percentage of the price level in the base period, which equals 100 C. the inflation rate in a given period compared to the inflation rate in the base period, which equals 100 D. the inflation rate in a given period compared to the inflation rate in the base period, which equals zero