Please solve all need final answer only 16) Consider the following data on prices and production values. The average household spend30% of their monthly income on services and 70% of their monthly income on manufacturedgoods.Manufactured GoodsServicesYearQuantityPriceQuantity120Price1983150$10$15$20$22012220$8$143602021260590The CPI (1983 = 100) for 2021 isа) 260b) 320c) 350d) 28017) Since the start of the war in Ukraine, oil has jumped from $75 per barrel (Dec. 2020) to over$105 per barrel. Higher oil prices will raise the price of energy across the board.Considering the fact that the energy sector in the US represents around 7.6% of GDP and thatenergy makes up around 12% of the average household's monthly budget, rank the followingprice indices from most affected by this event to least affected by this eventa) CPI, Chained CPI, GDP Deflator, Core CPIb) Core CPI, CPI, GDP Deflator, Chained CPIc) GDP Deflator, Core CPI, CPI, Chained CPId) GDP Deflator, Chained CPI, Core CPI, CPI18) Studies have shown that the CPI consistently overstates inflation in the US, Why is this?a) The fixed weights of the CPI don't allow for consumers to substitute cheaper products toavoid some price increasesb) The CPI isn't properly accounting for people finding lower prices at discount stores andamazonc) Hedonically adjusting fails to correctly account for new productsd) All of the above19) There has been recent concern about the recent increase in inflation as measured by growthin the CPI. The CPI in Jan 2000 was 169.3 while the CPI for January 2020 (just prior to theCOVID craziness) was 258.7. In January 2022, the CPI was 281.9. Assuming an exponentialtrend, how far off trend is the CPI in January 2022?a) 2.5%b) 5.3%c) 4.4%d) 8.9%

Year Qm Pm Qs Ps 1983 150 10 120 2 2021 260 20 590 14

16) Consider the following data on prices and production values. The average household spend 30% of their monthly income on services and 70% of their monthly income on manufactured goods. Manufactured Goods Services Price $2 $8 $14 Price Quantity 120 Year Quantity 150 1983 2012 2021 $10 $15 $20 360 590 220 260 The CPI (1983 = 100) for 2021 is a) 260 b) 320 c) 350 d) 280 S75 nor harrel (Dec. 2020) to over

16) Consider the following data on prices and production values. The average household spend 30% of their monthly income on services and 70% of their monthly income on manufactured goods. Manufactured Goods Services Price $2 $8 $14 Price Quantity 120 Year Quantity 150 1983 2012 2021 $10 $15 $20 360 590 220 260 The CPI (1983 = 100) for 2021 is a) 260 b) 320 c) 350 d) 280 S75 nor harrel (Dec. 2020) to over

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Measuring The Cost Of Living

Section: Chapter Questions

Problem 6PA

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Similar questions

Table 22.4 shows the fruit prices that the typing college student purchased from 2001 to 2004. What is the amount spent each year on the basket of fruit with the quantities shown in column 2?
How to Measure Changes in the Cost of Living introduced a number of different price indices. Which price index would be best to use to adjust your paycheck for inflation?
The Consumer Price Index is subject to the substitution bias and me quality/new goods bias. Are the Producer Price index and the GDP deflator also subject to these biases? Why or why not?
Question 2a) What is the Consumer Price Index (CPI)?b) Consider an economy that produces and consumes shoes and houses. In thetable below are data for two different users.Year2000Year2001 Price of a house $120,000 $145,000Price of a pair of shoes $150 $170Number of houses produced 1,000 1,050Number of pairs of shoes 650,000 525,000(i) Calculate the CPI for both years.(ii) Calculate the rate of inflation for 2001 using the CPI.(iii) Calculate the GDP deflator for both years.(iv) Calculate the rate of inflation for 2001 using the GDP deflator.
13. Which of these statements regarding Consumer Price Index (CPI) are accurate? Select all that apply. A. The CPI can be computed for one industry or for the entire economy. B. CPI does not take into account a product's share of market sales when determining inflation for an entire economy. C. To figure out the current CPI, you first have to figure out the CPI for the base year. D. Inflation is the change in CPI.
8 2. Average hourly earnings of all employees increased from $ 29.93 per hour to $ 31.40 per hour in the United States in the year 2021. The CPI at the beginning of 2021 was 262.20 and Increased to 280.13 by the end of 2021 in the United States The average wage increased nearly $ 1.50 per hour or an average of $ 3000 increase in annual pay . Explain in detail what this m in terms of the changes in the real wage and purchasing power of the income ,
13. Refer to Table 24-3. Calculate the inflation rate for March. 14. Explain how the prices of goods and services used in the CPI differ from the prices reflected by GDP deflator.
Calculate a new consumer price index for the data in the following exhibit. Assume that current-year prices of Twinkies, fuel oil, and internet are $0.95/package, $1.25/gallon, and $15.00/month, respectively. Calculate the current year’s cost of the market basket and the value of the current year’s price index. What is this year’s percentage change in the price level compared to the base year? Product (1) Quantity in Market Basket (2) Prices in Base Year Twinkies 365 packages $ 0.89/package Fuel oil 500 gallons 1.00/gallon Internet 12 months 30.00/month