Suppose in 2017​, the United Kingdom economy was at full employment.   Nominal GDP was ​£2,665 ​billion, the real interest rate was 4 percent per​ year, the inflation rate was 3 percent a​ year, and the price level was 125.   Calculate the nominal interest rate.   In the long​ run, if the real interest rate remains the same but the inflation rate increases to 9 percent a​ year, how does the nominal interest rate​ change? The nominal interest rate is nothing percent a year. In the long​ run, if the real interest rate remains the same but the inflation rate increases to 9 percent a​ year, then the nominal interest rate   ▼   decreases to remains unchanged at increases to ------ percent a year.

For each of the following years, determine the real interest rate. Find the difference between this rate and the desired real interest rate and explain how any difference affects borrowers and lenders. Write out percentage rates as whole numbers e.g. 5%. a. In year 1, the nominal interest rate is 10%, the inflation premium on loans is 4%, and actual rate of inflation is 5%. %, the desired real interest is %, borrowers are (Click to select) and lenders are The real interest rate is (Click to select) b. In year 2, the nominal interest rate is 11%, the inflation premium is 5%, and the actual rate of inflation is 3%. %, borrowers are (Click to select) %, the desired real interest is The real interest rate is (Click to select) ✓ c. In year 3, the nominal interest rate is 9%, the inflation premium is 3%, and the actual rate of inflation is 3%. %, borrowers are (Click to select) and lenders are The real interest rate is (Click to select) %, the desired real interest is and lenders are

3) Suppose workers and firms expect the overall price level to increase by 4%. Given this information, we would expect that: A) the real wage will decrease by 4%. B) the real wage will increase by 4%. C) the nominal wage will increase by less than 4%. D) the nominal wage will increase by more than 4%. E) the nominal wage will increase by exactly 4%.

The real interest rate is 6 percent a year and the income tax rate is 50 percent.   With no​ inflation, what is the real​ after-tax interest​ rate?   If the inflation rate rises to 4 percent a​ year, what is the real​ after-tax interest​ rate?

Given the following table about the level of the consumer price index (CPI), perform calculations and show your work in the coming parts of the question.   Consumer Price Index Year Consumer Price Index 2015 139.5 2016 144.7 2017   2018 160.1 2019 168.1   Calculate the inflation rate in 2016. If the inflation rate was 6 percent in 2018, calculate the CPI in 2017.

The rate of inflation measures the percentage increase in the price of consumer goods. The rate of inflation in the year 2014 was 2% per y in the long run, let's suppose that it persists through 2034. What would be the cost in 2015 of an item that costs $400 in 2014? (Round your answer to the nearest cent.)

Assume the expected rate of inflation is 3 percent per year.  What nominal interest rate should you charge to receive a real interest rate of 2 percent per year?

assume instead that the nominal interest rate is 4 percent and the expected rate of inflation is minus 1 percent.  Calculate the real rate of interest.

A) Inflation is the steady and widespread increase in prices. The inflation rate, measured by CPI, rose .1% in May (since April) and rose a total of 4% year-over-year (May 2022 to May 2023). Read the BLS report on the Consumer Price Index and identify an “item” or “all items” and begin to consider why the price increased. Do a news search or using (clear, logical, rational) reasoningexplain whether prices are increasing because demand increased or because supply decreased. Graph and explain your answer

A) Inflation is the steady and widespread increase in prices. The inflation rate, measured by CPI,  rose .1% in May (since April) and rose a total of 4% year-over-year (May 2022 to May 2023). Read  the BLS report on the Consumer Price Index and identify an “item” or “all items” and begin to  consider why the price increased. Do a news search or using (clear, logical, rational) reasoning explain whether prices are increasing because demand increased or because supply decreased.  Graph and explain your answer