Q: If the inflation rate is 3% per year, how many years will it take for the cost of an item to double,…
A: Given:Inflation Rate=3% per year
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A: Answer-
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A:
Q: If the CPI increased from 80 to 84, the rate of inflation is: Group of answer choices 4.7% 10% 4% 5%
A: CPI: It is used as a measure of the aggregate price level in an economy.
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A: CPI in period 1= 125 and CPI in period 2= 150.
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A: Inflation rate is the increase in prices of goods and services. It helps in identifying the amount…
Q: ) In 1990, the CPI was 130.7 and in 1996 the CPI was 156.9. What was the rate of inflation over this…
A: Inflation is the rate of increase in prices over a given period of time. Here, we calculate the…
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A:
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A: The ‘core inflation is the change in the cost of goods and services but does not include people in…
Q: Considering 2010 as the base year, calculate inflation rate for each year (2011-2019) and fill the…
A: Given; Years CPI 2010 100 2011 111.92 2012 122.75 2013 132.19 2014 141.70 2015 145.28…
Q: f the Consumer Price Index was 155 in one year and 165 in the next year, then the rate of inflation…
A: Consumer Price Index measures the change in the price of a fixed basket bought by a typical consumer…
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- The index number representing the price level changes from 110 to 115 in one year and then from 115 to 120 the next year. Since the index number increases by five each year, is five inflation rate each year? Is the inflation rate the same each year? Explain your answer.Lucy is tempted to buy 200 apples, with each one costing $2. However, she realizes that if she saves the money in a bank account she should be able to buy 240 apples. If the cost of the an apple increases by the rate of inflation, i.e. 8%, according to the Fisher equation, how much would the nominal rate (%) of the return on the bank account have to be? Explain with calculations and conclusionSuppose the base year bundle of goods X, Y, and Z is: (X^(b), Y^(b), Z^(b))= (5,700,60) and the base year (vector of) prices is: (Px^(b),Py^(b), Pz^(b))=(1000,5,25) The following year the (vector of) prices is: (Px^(b+1), Py^(b+1), Pz^(b+1))= (1010,5.05,27.50) 1) Compute the inflation using a Laspeyres Price Index, like the original form of the Consumer Price Index(CPI). 2) Compute the inflation index an alternative way. Calculate the price increase for each good separatelyand then take a weighted average of these price increases, using as weights the budget shares spent on eachgood in the base year. For example, for good X use weight Sx^(b)= (Px^(b)X^(b))/(Px^(b)X^(b)+ Py^(b)Y^(b)+Pz^(b)Z^(b)) Please show all work very confused
- Suppose that the average annual growth rate of nominal GDP over a period is 6.8% and the average annual inflation rate over the same period is 3.7%. What is the growth rate of real GDP? Use the exact formula and express your answer in percentage rounded to the nearest first decimal.CPI inflation in India rose to 4.9% y-o-y in November from 4.5% in October, below expectations (5.1%), with a downside surprise in food and fuel price inflation, but core inflation rose further to 6.1% from 5.9%, signalling rising underlying price pressures. The cut in excise duties on fuel was offset by higher price increases in personal care, clothing, recreation and households goods and services in the CPI basket, suggesting pressures due to rising input cost pass-through and reopening. In this context, suppose people in India anticipate an increase in the expected price level. a) Determine whether the event shifts aggregate demand (AD) or aggregate supply (AS). b) Use the AD-AS model to determine the short-run and long-run effects on India’s GDP, price level, and unemployment.CPI inflation in India rose to 4.9% y-o-y in November from 4.5% in October, below expectations (5.1%), with a downside surprise in food and fuel price inflation, but core inflation rose further to 6.1% from 5.9%, signalling rising underlying price pressures. The cut in excise duties on fuel was offset by higher price increases in personal care, clothing, recreation and households goods and services in the CPI basket, suggesting pressures due to rising input cost pass-through and reopening. Source: Economic Times (2021) In this context, suppose people in India anticipate an increase in the expected price level. a) Determine whether the event shifts aggregate demand (AD) or aggregate supply (AS). b) Use the AD-AS model to determine the short-run and long-run effects on India’s GDP, price level, and unemployment.
- CPI inflation in India rose to 4.9% y-o-y in November from 4.5% in October, below expectations (5.1%), with a downside surprise in food and fuel price inflation, but core inflation rose further to 6.1% from 5.9%, signalling rising underlying price pressures. The cut in excise duties on fuel was offset by higher price increases in personal care, clothing, recreation and households goods and services in the CPI basket, suggesting pressures due to rising input cost pass-through and reopening. Source: Economic Times (2021) In this context, suppose people in India anticipate an increase in the expected price level. a) Determine whether the event shifts aggregate demand (AD) or aggregate supply (AS). (6 marks) b) Use the AD-AS model to determine the short-run and long-run effects on India’s GDP, price level, and unemployment.Interest, inflation, and purchasing power Suppose Dalia is a fan of young-adult fiction and buys only young-adult books. Dalia deposits $2,000 into a savings account that pays an annual nominal interest rate of 20%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a young-adult book has a price of $20.00. Initially, Dalia's $2,000 deposit has a purchasing power of #????? young-adult books. For each of the annual inflation rates given in the following table, first determine the new price of a young-adult book, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Dalia's deposit after one year in the first row of the table for each inflation rate. Finally, enter the value for the real interest rate at each of the given inflation rates. Hint: Round your answers in the first row down to the nearest young-adult book. For example, if you find that the deposit will cover…Suppose that all prices rise at the same proportional (inflation) rate of 19% per year. For an item that currently costs P0, find the nominal price of a) a 20 kg bag of corn, presently costing $16, after five years; b) a $4.40 can of coffee after ten years; c) a $250,000 house after four years please explain step by step
- The CPI inflation rate from 1982 to 2002 is ________ and from 2002 to 2022 is ________. The difference in the rates of inflation is ________. A. 46.9 percent; 33.7 percent; -13.2 percentage points B. 46.9 percent; 33.7 percent; -28.1 percentage points C. 88.4 percent; 50.9 percent; -42.4 percentage points D. 88.4 percent; 50.9 percent; -37.5 percentage pointSuppose the price level reflects the number of dollars needed to buy a basket of goods containing one cup of coffee, one donut, and one newspaper. In year one, the basket costs $9.00. In year two, the price of the same basket is $8.00. From year one to year two, there is (a. inflation, b. deflation) at an annual rate of ___ %. In year one, $72.00 will buy ____ baskets, and in year two, $72.00 will buy ____ baskets. This example illustrates that, as the price level falls, the value of money (a. rises, b. falls, c. remains the same).Suppose you have $400 and the inflation rate is 4 percent. In order to earn a real return of $20 on your investment, the nominal interest rate must be OA. 1 percent. B. 5 percent. C. 9 percent. D. 12 percent. ...
