Use the following table to answer questions about the hypothetical BYU Treats economy, which produces three goods. For each of these questions, show your work. Basket Items Unit $ per unit (2020) $ per unit (2021) $ per unit (2022) Cougar Tail 1 donut $5 $4.50 $4.25 Mint Brownie ½ sheet $29.98 $34.99 $39.99 Graham Canyon ice cream 5 quarts $14.99 $16.49 $17.99 i. Calculate the CPI (Consumer Price Index) for each year, using 2020 as the base year ii. What is the inflation rate from 2020 to 2021? iii. What is the inflation rate from 2020 to 2022? iv. Did the price of a Cougar Tail increase or decrease in real terms from 2020 to 2022? By how much?
Use the following table to answer questions about the hypothetical BYU Treats economy, which produces three goods. For each of these questions, show your work. Basket Items Unit $ per unit (2020) $ per unit (2021) $ per unit (2022) Cougar Tail 1 donut $5 $4.50 $4.25 Mint Brownie ½ sheet $29.98 $34.99 $39.99 Graham Canyon ice cream 5 quarts $14.99 $16.49 $17.99 i. Calculate the CPI (Consumer Price Index) for each year, using 2020 as the base year ii. What is the inflation rate from 2020 to 2021? iii. What is the inflation rate from 2020 to 2022? iv. Did the price of a Cougar Tail increase or decrease in real terms from 2020 to 2022? By how much?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Use the following table to answer questions about the hypothetical BYU Treats economy, which produces three goods. For each of these questions, show your work.
Basket Items Unit $ per unit (2020) $ per unit (2021) $ per unit (2022)
Cougar Tail 1 donut $5 $4.50 $4.25
Mint Brownie ½ sheet $29.98 $34.99 $39.99
Graham Canyon ice cream 5 quarts $14.99 $16.49 $17.99
i. Calculate the CPI (Consumer Price Index ) for each year, using 2020 as the base year
ii. What is the inflation rate from 2020 to 2021?
iii. What is the inflation rate from 2020 to 2022?
iv. Did the price of a Cougar Tail increase or decrease in real terms from 2020 to 2022? By how much?
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