Using CPI data, the seems to be a __________ relationship between the frequency of price changes and the ___________ of the good. a. negative, durability b. positive, durability c. positive, desirability d. negative, desirability
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- 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?The table represents the economy of bonaadventure coffee is used to make cappuccinos and has no other use coffee makers and bean grinders I purchase by all entities as our a cappuccinos the government has determined that the average consumer purchases one coffee maker to Bing grinders and 1000 cappuccinos when necessary used 2019 as a base year A.Calculate the CPI for 2017 b.calculate the inflation for 2019 to 2020 c. calculate the real wage of someone earning $10 in 2020Need help with this. Thanks! 3. This year Anjun's monthly pay rose from $1000 (last year's rate) to $1100 (this year's rate). During the year the inflation rate for consumer products was 12%. A. What happened to Anjun's nominal income? (up or down, and by what percent?) B. What happened to Anjun's real income? (up or down and by what percent?
- (a) The Consumer Price Index (CPI) in December 1980 was 86.3. The Consumer Price Index as of December 2021 is 278.8. If the minimum wage would have increased at the same rate as the CPI from 1980 to 2021, what would the hourly minimum wage be in 2021? (b) Using the CPI, if the CPI in the base year 1982-1984 is 100 and the CPI in 1980 is 86.3, then what would the real minimum wage be in 1981? (c) Using the CPI, if the CPI in the base year 1982-1984 is 100 and the CPI in 2021 is 278.8, then what would t he real minimum wage be in 2021?Price of petrol was Rs. 60 per litre in 2015 and Rs. 100 per litre in 2021. The average wage in manufacturing was Rs. 240 per hour in 2015 and 300 in 2021. a. Did workers’ purchasing power in terms of petrol rise or fall?Given that the CPI for 2016 is 100, (a)Compute the CPI inflation rates for the years 2017 and 2018. (b)(i) Determine the percentage change in GDP deflator for 2016-2017 and 2017-2018. (ii) Compare your results in (i) above with your answers in (a) and justify. [ (c)Explain three problems associated with using CPI to measure cost of living. (d)State any two logical information you can infer about the hypothetical economy described above. (e)The government in 2018 announced and implemented a 10 percent increase in the nominal salary of an average public servant from Gh¢500 in 2017. Does the salary of an average public servant have more purchasing power in 2017 or 2018? (f)Briefly describe the concept of ‘rebasing’. Explain how rebasing affects the income and cost of living estimates of a country.
- Suppose on January 15, 2013, the U.S. Treasury issued a five-year inflation-indexed note with a coupon of 4%. On the date of issue, the consumer price index (CPI) was 237. By January 15, 2018, the CPI had increased to 307. What principal and coupon payment was made on January 15, 2018? (Note: U.S. Treasury pays semi-annual coupons) Question content area bottom Part 1 The CPI index appreciated by enter your response here. (Round to five decimal places.) Part 2 The principal amount of the bond increased to $enter your response here. (Round to the nearest cent.) Part 3 The semi-annual coupon payment is $enter your response here. (Round to the nearest cent.)Question 1Evaluate how each of the following individuals would be affected by unanticipated inflation:a) A department store clerkb) A heavily indebted farmerc) A private pensionerQuestion 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…. A small nation idolizes the TV show The Voice. Allthey produce and consume are karaoke machinesand CDs, in the following amounts:Karaoke Machines CDsQuantity Price Quantity Price2020 10 $40 30 $102021 12 60 50 12a. Using a method similar to the CPI, computethe percentage change in the overall price level.Use 2020 as the base year and fix the basket at1 karaoke machine and 3 CDs.b. Using a method similar to the GDP deflator,compute the percentage change in the overallprice level. Again, use 2020 as the base year.c. Is the inflation rate in 2021 the same using the twomethods? Explain why or why not.
- 1) Which of the following is FALSE regarding PPI?a. Stands for Producer Price Indexb. In manufacturing, measures the rate of change in prices of products sold as they leave the producerc. Measures the cost of the goods and services bought by firmsd. Measures the cost of the goods and services bought by a typical consumer2) CPI is measured using the ----------------- :a. overall productsb. overall cost of the goods and servicesc. overall cost of oild. none of the aboveTennis Balls Golf Balls Bottles of Gatorade 2020 price Rs.250 Rs.450 Rs.150 2020 quantity 100 100 200 2021 price Rs.25 Rs.653 Rs.255 2021 quantity 100 100 200 a. What is the percentage change in the price of Tennis Balls? b. What is the percentage change in the price of Golf Balls? c)What is the percentage change in the price of Bottles of Gatorade?d)Using a method similar to the CPI, compute the percentage change in the overall price level.
