True or False: “If CPI reads 300 in August 2022 and 309 in August 2023, then inflation rate is 9%.”

www.m WO The country of Swedway monitors price changes on several hundred goods in 4 categories: food, housing, transportation and household goods, in accordance with the following CPI table: Calculate the contribution to inflation for each category and determine the overall inflation rate in Swedway. CATEGORY WEIGHT (%) PRICE CHANGE (%) CONTRIBUTION TO INFLATION RATE Food 40 10 Housing 30 15 Transportation 20 20 Household Goods 10 25 Total 100

Answer All parts

Please answer d e and f

Suppose that people in the small island country of Mudotch produce and consume rice and beans as follows. Rice Beans Year Quantity Price Quantity Price YearO 20 5 15 7 Year1 25 7 17 10 Year2 35 9 20 16 1. Calculate the consumer price index (CPI) in each year using YearO as the base year. Show your work. 2. Using your CPI in (a), what is the inflation rate in Year1 and Year2? Show your work. 3. Calculate the GDP deflator in each year using YearO as the base year. Show your work. 4. Using your GDP deflator in (c), what is the inflation rate in Year1 and Year2? Show your work. 5. Is the inflation rate in Year2 the same in (b) and (d)? Explain why or why not.

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In 1984 Michael Jordan got a contract with Nike that was worth $500,000 a year, for the next 5 years (1984-1988, inclusive). How much the contract would worth, year-by-year, if we express it in 2018 dollars? Use the following data for this calculation: Year 1984 1985 1986 1987 1988 2018 CPI 103.9 107.6 109.6 113.6 118.3 251.631

If Inflation is 2% and nominal interest rate is 4% Calculate real interest rate

The cost of the basket of goods in a particular year was $78.00 while in the base year the cost was $60. What is the CPI?      100     115     130     140

(3) Find the trend of a country using the provided CPI based inflation rates Year Inflation rate (%) a Stagflation b Disinflation C Deflation d 2017 2 Creeping inflation 2016 5 2015 6 2014 7 2013 9