Eco1102 Assignment 1 David grey Essay

1239 Words Feb 23rd, 2014 5 Pages
1. a) i) The content of the table is about Canada’s economic and financial situation divided into four sectors: real sector, fiscal sector, financial sector, and external factor. Each of the four sectors is divided into smaller categories. For example: real sector is divided into national accounts, production index, labor market, prices indices. The other three factors are also divided into smaller categories just like the real sector. In addition, this table has the most recent GDP to show the success of Canada’s economy. The overall goal of the data is to show Canada’s recent economic situation.

ii) There are five level one headings in this table, which are: real sector, fiscal sector, financial sector, external sector, and
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Therefore, $258,459/$1,819,967= 14.20%.

2. The Bank of Canada is interested in core inflation because compared to inflation, core inflation exclude food, energy and those products with a unstable price. Core inflation as a measure of inflation for policy purposes, it measures inflation more precisely. Core inflation represents the long run trend in the price level. Compared to CPI, core inflation is generally lower because it tries to maintain the price as it avoids high inflation and deflation over time.

3. b) i) Inflation rate between Dec. of 2009 and Dec. of 2008.
The formula would be: (CPI(2009)/CPI(2008)-1)*100=((115.4/113.9)-1)*100≈1.32%
Date
CPI
Dec-08
113.9
Jan-09
113.7
Feb-09
114.1
Feb-10
115.9
Apr-09
113.7
May-09
114.2
Jun-09
114.7
Jul-09
114.3
Aug-09
114.5
Sep-09
114.6
Oct-09
114.8
Nov-09
115.4
Dec-09
115.4

b) ii) Inflation rate between Dec. 2013 and Dec. 1992.
The formula would be: (CPI(2013)/CPI(1992)-1)*100=((123.5/84.7)-1)*100≈45.81% Date CPI
Dec-92
84.7
Dec-13
123.5

b) iii) Inflation rate between October 2013 and October 2002.
Date
CPI
Oct-02
101.3
Oct-13
123

The formula would be:(CPI(2013)/CPI(2002)-1)*100=((123/101.3)-1)*100≈21.42%

c.

In 1981, the inflation rate was the highest, it was about 12.50%. After that, the inflation rate was decreasing and later on its ups and downs. The inflation rate was the lowest in

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