rates are rounded to the nearest tenth of a percent.) Year 1971 1972 1973 1974 1975 INTEREST RATE (Percent) Source: "Economic Report of the President (2007)," United States Government Printing Office, last modified February 1, 2007, accessed March 11, 2013, http://www.gpo.gov/fdsys/pkg/ERP-2007/pdf/ERP-2007.pdf. On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. 8.0 7.0 6.0 5.0 4.0 0 -1.0 -3.0 -4.0 Nominal Interest Rate (Percent) 4.5 4.5 7.2 7.9 6.1 1970 O 1971 1972 1973 1974 1971 1975 Inflation Rate (Percent) 4.4 3.2 6.2 11.0 9.1 1972 1973 YEAR According to the table, in which year did buyers of six-month Treasury bills receive the 1974 1975 1976 Nominal Interest Rate Real Interest Rate ? t real retu on their investment?

rates are rounded to the nearest tenth of a percent.) Year 1971 1972 1973 1974 1975 INTEREST RATE (Percent) Source: "Economic Report of the President (2007)," United States Government Printing Office, last modified February 1, 2007, accessed March 11, 2013, http://www.gpo.gov/fdsys/pkg/ERP-2007/pdf/ERP-2007.pdf. On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. 8.0 7.0 6.0 5.0 4.0 0 -1.0 -3.0 -4.0 Nominal Interest Rate (Percent) 4.5 4.5 7.2 7.9 6.1 1970 O 1971 1972 1973 1974 1971 1975 Inflation Rate (Percent) 4.4 3.2 6.2 11.0 9.1 1972 1973 YEAR According to the table, in which year did buyers of six-month Treasury bills receive the 1974 1975 1976 Nominal Interest Rate Real Interest Rate ? t real retu on their investment?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter22: Inflation

Section: Chapter Questions

Problem 34P: The total price of purchasing a basket of goods in the United Kingdom over four years is: year...

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The total price of purchasing a basket of goods in the 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 base year (set equal to 100) and the other using year 4 as the base year (set equal to 100). Then, calculate the inflation rate based on the first price index. If you had used the other price index, would you get a different inflation rate? If you are unsure, do the calculation and find out.
The following table shows the average nominal interest rates on six-month Treasury bills between 1997 and 2001, which determined the nominal interest rate that the U.S. government paid when it issued debt in those years. The table also shows the inflation rate for the years 1997 to 2001. (All rates are rounded to the nearest tenth of a percent.) Nominal Interest Rate Inflation Fte Year (Percent) (Percent) 1997 5,2 2.3 1998 4.8 1.5 1999 4.8 2.2 2000 5.9 3.4 2001 3.4 2.8 Source: "FRED Economic Data," Federal Reserve Bank of St. Louis, last modified September 23, 2019, accessed September 24, 2019, https://fred.stlouisfed.org. On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1997 to 2001. Next, use the green points (triangle symbol) to plot the real interest rates for those years.
The following table shows the average nominal interest rates on six-month Treasury bills between 2014 and 2018, which determined the nominal interest rate that the U.S. government paid when it issued debt in those years. The table also shows the inflation rate for the years 2014 to 2018. (All rates are rounded to the nearest tenth of a percent.) Year Nominal Interest Rate Inflation Rate (Percent) (Percent) 2014 0.1 1. 6 2015 0.2 0.1 2016 0.5 1.3 2017 1.1 2.1 2018 2.1 2.4 On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 2014 to 2018. Next, use the green points (triangle symbol) to plot the real interest rates for those years. According to the table, in which year did buyers of six-month Treasury…
The following table gives the average nominal interest rates on six-month Treasury bills spanning the years 1971 and 1975, which determined the nominal interest rate paid by the U.S. government when it issued debt in that time period. The table also gives the inflation rate for the years 1971 to 1975. (All rates rounded to the nearest 0.1 percent.) Year 1971 1972 1973 INTEREST RATE (Percent) 1974 1975 8.0 Source: "FRED Economic Data," Federal Reserve Bank of St. Louis, last modified September 23, 2019, accessed September 24, 2019, https://fred.stlouisfed.org. 7.0 On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. 6.0 5.0 4.0 3.0 2.0 1.0 0 -1.0 + -2.0 -3.0 Nominal Interest Rate (Percent) 4.5 4.5 7.2 1970 OOOO O 1971 O 1972 O 1973 8.0 O 1974 6.1 1971 O 1975 Inflation Rate (Percent) 4.2 3.3 6.3 11.0 9.1 1972 1973 YEAR 1974…
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