In each of the following cases, does the increase in prices affect CPI, GDP deflator, or both in Pakistan? Analyze and justify your answer (in detial). The price of imported capital goods used in the production of sugar has increased. The price of Tapal tea has increased. Answer from your experts are attached but i am confused. (two diffrent statement), first statement is mentioned below and others screenshot is attached. The rise in the price of capital goods affects only the CPI of the country as this may cause a change in the price of sugar domestically. The GDP deflator does not include this as it only includes domestic production. The increase in the price of tea causes a change in both GDP deflator and CPI. As it's produced domestically, it causes a change in the GDP deflator. Tea is a part of the basket of goods used to measure CPI and hence it causes a change here too. ................ for capital goods i found two diffrent answer from your expert. i am confused one says both cpi and gdp deflator will affected other says only cpi will be affected.
In each of the following cases, does the increase in prices affect CPI, GDP deflator, or both in Pakistan? Analyze and justify your answer (in detial). The price of imported capital goods used in the production of sugar has increased. The price of Tapal tea has increased. Answer from your experts are attached but i am confused. (two diffrent statement), first statement is mentioned below and others screenshot is attached. The rise in the price of capital goods affects only the CPI of the country as this may cause a change in the price of sugar domestically. The GDP deflator does not include this as it only includes domestic production. The increase in the price of tea causes a change in both GDP deflator and CPI. As it's produced domestically, it causes a change in the GDP deflator. Tea is a part of the basket of goods used to measure CPI and hence it causes a change here too. ................ for capital goods i found two diffrent answer from your expert. i am confused one says both cpi and gdp deflator will affected other says only cpi will be affected.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter16: Measuring The Cost Of Living
Section: Chapter Questions
Problem 3CQQ
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In each of the following cases, does the increase in prices affect
- The price of imported capital goods used in the production of sugar has increased.
- The price of Tapal tea has increased.
Answer from your experts are attached but i am confused. (two diffrent statement), first statement is mentioned below and others screenshot is attached.
- The rise in the price of capital goods affects only the CPI of the country as this may cause a change in the price of sugar domestically. The GDP deflator does not include this as it only includes domestic production.
- The increase in the price of tea causes a change in both GDP deflator and CPI. As it's produced domestically, it causes a change in the GDP deflator. Tea is a part of the basket of goods used to measure CPI and hence it causes a change here too.
................
- for capital goods i found two diffrent answer from your expert. i am confused
- one says both cpi and gdp deflator will affected
- other says only cpi will be affected.
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