Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN: 9781305971509
Author: N. Gregory Mankiw
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 11, Problem 7PA
Subpart (a):
To determine
Measuring the changes in
Subpart (b):
To determine
Measuring the changes in price, wages and purchasing power.
Subpart (c):
To determine
Measuring the changes in price, wages and purchasing power.
Subpart (d):
To determine
Measuring the changes in price, wages and purchasing power.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
A dozen eggs cost $1.03 in December 1980 and $1.60 in December 2018. The average wage for workers in private industries was $7.13 per hour in December 1980 and $23.09 in December 2018.
By what percentage did the price of a dozen eggs rise?
36%
55%
57%
By what percentage did the wage rise?
32%
62%
224%
In order to earn enough to buy a dozen eggs, a worker had to work _______ minutes in December 1980 and_________ minutes in December 2018.
Workers' purchasing power in terms of eggs_________ between 1980 and 2018.
A dozen eggs costs $o.88 in January 1980 and 2.11 in January 2015. The average wage for production workers was $7.58per hour in January 1980 and $19.64 in January 2015
By what percentage did the price of eggs rise?
By what percentage did the wage rise?
In each year, how many minutes did a worker have to work to earn enough to buy a dozen eggs?
Did workers’ purchasing power in terms of eggs rise or fall?
Cost of a dozen oranges wasRs80 in January 1980 and Rs.170 in January 2018. The average hourly wage for production and nonsupervisory workers was Rs.650 in January 1980 and Rs.2200 in January 2018.
By what percentage did the price of oranges rise?
By what percentage did the wage rise?
In each year, how many minutes did a worker have to work to earn enough to buy a dozen oranges?
Did workers’ purchasing power in terms of oranges rise or fall?
Chapter 11 Solutions
Principles of Macroeconomics (MindTap Course List)
Knowledge Booster
Similar questions
- Does an increase in the price of imported Belgian chocolate affect the CPI or the GDP deflator more? Why (Word count: 100 words max.) 2. Cost of a dozen oranges was Rs80 in January 1980 and Rs.170 in January 2018. The average hourly wage for production and nonsupervisory workers was Rs.650 in January 1980 and Rs.2200 in January 2018. By what percentage did the price of oranges rise? By what percentage did the wage rise? In each year, how many minutes did a worker have to work to earn enough to buy a dozen oranges? Did workers’ purchasing power in terms of oranges rise or fall?arrow_forwardDoes an increase in the price of imported Belgian chocolate affect the CPI or the GDP deflator more? Why (2 Mark) (Word count: 100 words max.) Cost of a dozen oranges was Rs80 in January 1980 and Rs.170 in January 2018. The average hourly wage for production and nonsupervisory workers was Rs.650 in January 1980 and Rs.2200 in January 2018. By what percentage did the price of oranges rise? (1 Mark) By what percentage did the wage rise? (1 Mark) In each year, how many minutes did a worker have to work to earn enough to buy a dozen oranges? (1 Mark) Did workers’ purchasing power in terms of oranges rise or fall? (1 Markarrow_forwarda) Does an increase in the price of imported Belgian chocolate affect the CPI or the GDP deflator more? Why b) Cost of a dozen oranges was Rs80 in January 1980 and Rs.170 in January 2018. The average hourly wage for production and nonsupervisory workers was Rs.650 in January 1980 and Rs.2200 in January 2018. i. By what percentage did the price of oranges rise? ii. By what percentage did the wage rise? iii. In each year, how many minutes did a worker have to work to earn enough to buy a dozen oranges? iv. Did workers’ purchasing power in terms of oranges rise or fall?arrow_forward
- In the year 2000, the CPI was 172.2 and the GDP deflator was 78.7. In 2019, the CPI had risen to 258.4 and the GDP deflator to 112.5. a. How much did prices increase from 2000 to 2019 according to the CPI and how much according to the GDP deflator? Why is there a difference? b. If the price of a 12oz can of Coke was $1.25 in 2000 and the price was $1.75 in 2019, did the real price of Coke go up, down, or stay the same? Explain your answer.arrow_forwardA) Does an increase in the price of imported Belgian chocolate affect the CPI or the GDP deflator more? Why B) Cost of a dozen oranges wasRs80 in January 1980 and Rs.170 in January 2018. The average hourly wage for production and nonsupervisory workers was Rs.650 in January 1980 and Rs.2200 in January 2018. By what percentage did the price of oranges rise? By what percentage did the wage rise? In each year, how many minutes did a worker have to work to earn enough to buy a dozen oranges? Did workers’ purchasing power in terms of oranges rise or fall?arrow_forwardSuppose that typical CPI basket for consumers contains 3 goods: 5 wheels of cheese, 3 t-shirts, and 10 gallons of gasoline. The prices of the goods in 2019 and 2020 are listed below: Item Prices 2019 Prices 2020 Cheese $5 $10 T-shirt $10 $15 Gallon of Gasoline $3 $6 A) Find the cost of the CPI Basket in 2019: B) Find the cost of the CPI Basket in 2020: C) Using 2019 as the base reference period, calculate the CPI for 2020 D) What is the inflation rate in 2020? E) Suppose that you made $40,000 in 2019 and $41,000 in 2020. What has happened to your real income from 2019 to 2020?arrow_forward
- Compute how much each of the following items is worth in terms of today's dollars using 177 as the price index for today. a. In 1926 the CPI was 17.7 and the price of a movie ticket was $0.25. b. In 1932 the CPI was 13.1 and a cook earned $15.00 a week.c. In 1943 the CPI was 17.4 and a gallon of gas cost $0.19.arrow_forwardTennis 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.arrow_forward(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?arrow_forward
- Suppose in the 1982 base year a typical market basket purchased by an urban family cost $250. In 1996, the same market basket cost $1,000. The same market basket also cost $950 in 1995. A) What is the consumer price index (CPI) for 1996? B) What is the consumer price index (CPI) for 1995? C) What was the annual rate of inflation for 1996? d) Answer the Question in detail on the image providedarrow_forwardCongratulations! Your boss has given you a raise. However, you want to know whether your purchasing power has increased, since inflation is also rising. The table below gives you data for wages and the Consumer Price Index (CPI) for the last two years. Wage ($/day) CPI Year 1 $ 2000 CPI 120 Year 2 $2200 CPI 129.6 The nominal percentage increase in your wage is enter your response here%. (Round your answer to one decimal place.) Part 2 The real percentage increase in your wage is enter your response here%. (Round your answer to one decimal place.)arrow_forwardThe table shows the cost of a fixed basket of goods that a typical urban consumer would buy in the economy of Kindleberger. The base period for the consumer price index (CPI) is the year 2000. Please specify answers to two decimal places. Year Cost of a basket of goods 2000 $5,150.00 2011 $4,500.00 2012 $7,725.00 What is the CPI for 2000? CPI for 2000: What is the CPI for 2011? CPI for 2011: What is the CPI for 2012? CPI for 2012:arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Brief Principles of Macroeconomics (MindTap Cours...EconomicsISBN:9781337091985Author:N. Gregory MankiwPublisher:Cengage LearningEssentials of Economics (MindTap Course List)EconomicsISBN:9781337091992Author:N. Gregory MankiwPublisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...
Economics
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning