Suppose that government expenditures decrease by 12 from 20 to 8. Fill out column (3) of the Table. Find the new short-run equilibrium real GDP, inflation rate, and the growth rate of nominal wages.
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Suppose that government expenditures decrease by 12 from 20 to 8.
Fill out column (3) of the Table. Find the new short-run equilibrium real
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- If the CPI in period 1 is 125 and the CPI in period 2 is 150, then the rate of inflationbetween period 1 and period 2 isA) 20%.B) 25%.C) 30%.D) 50%The average rate of inflation in the United States in the last 100 years is approximately 3.26%. In the last year the rate has jumped to 8.5%. Determine the present worth of a future sum of $10,000 in 10 years. Also, determine the present worth of $10,000 10 years ago. Assume time starts when inflation changes from 3.26% to 8.5%. Also assume the 8.5% rate of inflation continues infinitely. Please correct solution and fasterThe accompanying table shows a utility company's cost to supply a fixedamount of power to a new housing development; the indices are specific to the utility industry. Assume that year 0 is the base period. Determine the specific inflation for each period and calculate the average inflation rate over the three year period. Year cost 0 $624.000 1 $638.400 2 $677,000 3 $729,500
- Shea is pricing materials (wood, wire, pipe, etc.) for new home construction on a “per unit” basis. Inflation on materials has been running at 16.0% for the past 3 years and is expected to remain at that rate for the next 10 years. The actual dollars paid for expenses at the end of year 3 for a “unit” are $55,000. Solve, a. What did the same set of materials cost 3 years ago? b. If the trend continues, what will they cost 10 years from now?The total price of purchasing a basket of goods inthe United Kingdom over four years is: year 1=£940,year 2=£970, year 3=£1000, and year 4=£1070.Calculate two price indices, one using year 1 as the baseyear (set equal to 100) and the other using year 4 as thebase year (set equal to 100). Then, calculate the inflationrate based on the first price index. If you had used theother price index, would you get a different inflationrate? If you are unsure, do the calculation and find out.pls ans as soon as possible The average rate of inflation since 1970 until 2018 is 3.87%. In 1970, a gallon of gas could be bought for $0.25. Today a gallon of gas can be bought for $2.21. Has the cost of gas risen faster or slower than the rate of inflation?
- If 2015 is the base year and the inflation rate between 2015 and 2016 is -4.5%, the priceindex in 2016 isA) 104.5.B) 95.5.C) -145.0.D) cannot be determined from this information because the base year is not knownTime remaining: 01 :56 :54 Economics To study the determinants of growth across the countries in the world, researchers have used country level observations averaged over long periods of time (e.g. averaged over 1960- 2000). Some of these studies have focused on the effect that inflation has on growth and found that although the effect is small for a given time period, it accumulates over time and therefore has an important negative effect. (a) Explain why the OLS estimator may be biased in this case. (b) Some authors have suggested using an index of the Central Bank Independence as an instrumental variable. Discuss whether or not such an index would be a valid instrument (discuss both relevance and exogeneity; note that instrumental validity is more of an economic rather than econometric conceptPlease no written by hand solution A homebuilder’s advertising had the caption, “Inflation to Continue for Many Years.” The ad explained that if one buys a home now for $297,000, and construction cost inflation continues at 7%, the home will be worth $819,400 in 15 years. Thus, by buying a new home now, one can realize a profit of $522,400 in 15 years. Do you find this logic persuasive? Explain. Please show excel formulas
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