EBK ECONOMICS TODAY
18th Edition
ISBN: 9780133920116
Author: Miller
Publisher: YUZU
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Question
Chapter 8, Problem 18P
To determine
(a)
To consider: The given graph and the base year.
To determine
(b)
To consider: The given graph and if the country experienced inflation or deflation since 2014.
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Students have asked these similar questions
Calculating Real GDP, Price Indices, and Inflation. Using the data from the table below, answer the following questions:
Quantities Produced
2011
2012
CDs
105
125
Tennis Rackets
210
220
Real GDP in 2011 using 2011 prices is $24255. (Enter your response as an integer.)
Real GDP in 2012 using 2011 prices is $25725. (Enter your response as an integer.)
Real GDP grew by 6.06 percent. (Enter your response as a percentage rounded to two decimal places.)
The price index for GDP (GDP Deflator) for 2012 using 2011 as the base year is
Price per CD
$21
$25
Prices
Price per Tennis Racket
$105
$125
(Enter your response rounded to two decimal places.)
1. Calculating inflation using a simple price index
Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. Suppose the following
table shows information on the market basket for the CSPI and the prices of each of the goods in 2017, 2018, and 2019.
The cost of each item in the basket and the total cost of the basket are shown for 2017.
Perform these same calculations for 2018 and 2019, and enter the results in the following table.
2017
2018
2019
Price
Cost
Price
Cost
Price
Cost
Quantity in Basket
(Dollars)
(Dollars)
(Dollars)
(Dollars)
(Dollars)
(Dollars)
Notebooks
15
2
30
8
Calculators
1
70
70
100
130
Large coffees
250
2
500
2
Energy drinks
50
2
100
4
Textbooks
10
120
1,200
150
180
Total cost
1,900
Price index
100
Suppose the base year for this price index is 2017.
The following table gives nominal and real GDP for an economy for two years.
Based on the table, in Year 2, the value of the GDP deflator is
Year 1
1430.0
1,300
Nominal GDP
Real GDP
(Round your answer to one decimal place.)
The inflation rate between Year 1 and Year 2 is %. (Round your answer to one decimal place.)
Year 2
1820.0
1560.0
Chapter 8 Solutions
EBK ECONOMICS TODAY
Ch. 8 - Prob. 8.1LOCh. 8 - Prob. 8.2LOCh. 8 - Prob. 8.3LOCh. 8 - Prob. 8.4LOCh. 8 - Prob. 8.5LOCh. 8 - Prob. aFCTCh. 8 - Prob. bFCTCh. 8 - Prob. cFCTCh. 8 - Prob. dFCTCh. 8 - Prob. eFCT
Ch. 8 - Prob. fFCTCh. 8 - Prob. 1CTQCh. 8 - Prob. 2CTQCh. 8 - Prob. 1FCTCh. 8 - Prob. 2FCTCh. 8 - Prob. 1PCh. 8 - Prob. 2PCh. 8 - Prob. 3PCh. 8 - Prob. 4PCh. 8 - Prob. 5PCh. 8 - Prob. 6PCh. 8 - Prob. 7PCh. 8 - Prob. 8PCh. 8 - Prob. 9PCh. 8 - Prob. 10PCh. 8 - Prob. 11PCh. 8 - Prob. 12PCh. 8 - Prob. 13PCh. 8 - Prob. 14PCh. 8 - Prob. 15PCh. 8 - Prob. 16PCh. 8 - Prob. 17PCh. 8 - Prob. 18P
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