Question

In: Economics

The residents of nnn spend all of their income on cauliflower, broccoli, and carrots. In 2020,...

The residents of nnn spend all of their income on cauliflower, broccoli, and carrots. In 2020, they spend a total of $250 for 100 heads of cauliflower, $100 for 50 bunches of broccoli, and $250 for 500 carrots. In 2021, they spend a total of $210 for 60 heads of cauliflower, $180 for 90 bunches of broccoli, and $270 for 450 carrots.

Complete the following table by calculating the price of one unit of each vegetable in each year.

Year

Cauliflower

Broccoli

Carrots
2020
2021

Using 2020 as the base year, the CPI for 2020 is   , and the CPI for 2021 is   .

The inflation rate in 2021 is    % using the CPI.

Solutions

Expert Solution

Price of unit of each vegetable

Year

Cauliflower

Broccoli

Carrots

2020

$2.50

$2

$0.50

2021

$3.50

$2

$0.60

Explanation:

Price of One Unit of Good= Total Spending / Total Quantity

In 2020,

They spend a total of $250 for 100 heads of cauliflower

Price of One Unit of Cauliflower = 250/100=$2.50 per unit

$100 for 50 bunches of broccolis,

Price of One Unit of Broccoli =100/50=$2 per unit

$250 for 500 carrots

Price of One Unit of carrot =250/500=$0.50 per unit

In 2021,

They spend a total of $210 for 60 heads of cauliflower

Price of One Unit of Cauliflower=210/60=$3.50 per unit

$180 for 90 bunches of broccolis,

Price of One Unit of Broccoli =180/90=$2 per unit

$270 for 450 carrots

Price of One Unit of carrot =270/450=$0.60 per unit

---------------------------------------------------------------------------------------------

CPI Calculation:

Given: 2020 is the base year

So the CPI for 2020 is 100

(The CPI for base year is always 100 as it is used as benchmark in the calculation of CPI)

CPI for 2021:

Current year price = 210 + 180 + 270 = 660

Base year price = 250 + 100 + 250 = 600

CPI for 2021 = 110

---------------------------------------------------------------------------------------------

Inflation rate = 10%

Rahul Sunny answered 2 years ago
Next > < Previous

Related Solutions

The residents of Vegopia spend all of their income on cauliflower, broccoli, and carrots. In 2010,...
The residents of Vegopia spend all of their income on cauliflower, broccoli, and carrots. In 2010, they buy 100 heads of cauliflower for $200, 50 bunches of broccoli for $75, and 500 carrots for $50. In 2011, they buy 75 heads of cauliflower for $225, 80 bunches of broccoli for $120, and 500 carrots for $100. a. Calculate the price of each vegetable in each year. b. Using 2010 as the base year, calculate the CPI for each year. c....
Year       Cauliflower         Broccoli                   Carrots      &nb
Year       Cauliflower         Broccoli                   Carrots                P      Q                     P          Q                 P               Q 2013       $2     100             $1.50     25                $0.10         450 2014       $3      120             $1.50    50                 $0.20         550 2013 is the base year. The BLS quantity number is 100 cauliflower   50 broccoli    500 carrots In the text box below SHOW ALL WORK for questions 1 & 2 and underline answers for both years, CPI and Inflation Levels and GDP Deflator and Inflation Levels. Answer Question 3 by using what you have...
Year       Cauliflower         Broccoli                   Carrots      &nb
Year       Cauliflower         Broccoli                   Carrots                P      Q                     P          Q                 P               Q 2013       $2     100             $1.50     25                $0.10         450 2014       $3      120             $1.50    50                 $0.20         550 2013 is the base year. The BLS quantity number is 100 cauliflower   50 broccoli    500 carrots In the text box below SHOW ALL WORK for questions 1 & 2 and underline answers for both years, CPI and Inflation Levels and GDP Deflator and Inflation Levels. Answer Question 3 by using what you have...
Do GA residents (population 1) spend more on cable than FL residents (population 2)? A GA...
Do GA residents (population 1) spend more on cable than FL residents (population 2)? A GA sample of 100 showed an average bill of $120 with a standard deviation of $15. A FL sample of 100 showed an average bill of $110 with a standard deviation of $10. Formulate the hypothesis: A. Ho: μ1–μ2<0 . Ha: μ1–μ2>0 B. Ho: μ1–μ2≤0 . Ha: μ1–μ2>0 C. Ho: μ1–μ2>0 . Ha: μ1–μ2≤ 0 D. Ho: μ1–μ2=0 . Ha: μ1–μ2>0 What is the p-value?...
If we know that Bridget is a consumer who does not spend all of her income,...
If we know that Bridget is a consumer who does not spend all of her income, what else can we deduce? a. Her budget line has moved outwards. b. Her budget line has moved inwards. c. She is operating at a point outside her budget line. d. She is operating at a point inside her budget line. Opportunity cost ______ directly involved in consumer choice; production costs ______ directly involved in consumer choice. a. is; are b. is; are not...
Subscribing to the theory that life is indeed a beach, the residents of La Playa spend...
Subscribing to the theory that life is indeed a beach, the residents of La Playa spend all of their money on three things: Every year, they collectively buy 250 bathing suits, 600 tubes of sunscreen, and 400 beach towels. Item (Amount purchased) Price 2013 ($) Price 2014 ($) Price 2015 ($) Price 2016 ($) Bathing suits (250) $10.00 $12.00 $15.00 $18.00 Sunscreen (600) 4.00 5.00 5.00 6.00 Beach towels (400) 5.00 5.50 7.00 9.00 Use the data in the table...
All of the following statements are true, except: a. Canadian residents must report their worldwide income...
All of the following statements are true, except: a. Canadian residents must report their worldwide income for tax purposes. b. If an individual is a resident of Canada for part of the calendar year, that individual only has to report his worldwide income during the period of residency for Canadian tax purposes. c. An individual who immigrates to Canada during the year is a resident of Canada for tax purposes for the full calendar year. d. An individual can be...
Compute the 2018 Federal income tax in the following cases. All are residents of New York...
Compute the 2018 Federal income tax in the following cases. All are residents of New York State. Alan, single, lives by himself, income 145,000, Itemized deductions 9,500. Bob, single lives with his brother who was fired from his job in 2016 and has not earned any money since then. Bob's income was 115,000 and itemized deductions of 21,000. Chad and Doris, married, no children or dependents.   Income itemized deductions Chad 125,000 31,000 Doris 135,000 4,500 Compute tax for Chad and...
You initially spend all of your income to purchase 5 units of x1 at a price...
You initially spend all of your income to purchase 5 units of x1 at a price of p1 = 2, and you purchase 5 units of x2 at a price of p2 = 4. (a) The price of x1 rises to p 0 1 = 3. What is the per-unit subsidy on x1 that is required for you to still be able to a§ord to purchase 5 units of x1 and 5 units of x2? (b) Now say that instead...
4. Say that you have an income of $100, all of which you spend on 2...
4. Say that you have an income of $100, all of which you spend on 2 goods: x1 and x2. The price of x1 is $1, and the price of x2 is $2. (a) The government imposes a quantity tax of on the consumption of x1. Write down an equation for your budget constraint. (b) The government initially sets the quantity tax at = 0:5. What is the slope of the budget constraint in this case? (c) Now say that...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT