Chapter 5: Chain-type growth rate, GDP deflator, Consumer Price Index (CPI), and Inflation Product Quantity Price...

Chapter 5: Chain-type growth rate, GDP deflator, Consumer Price Index (CPI), and Inflation

	Product	Quantity	Price
Year 1	Cereal	1,000	$1.00
	Beef	700	$2.00
	Doughnuts	600	$0.50
Year 2	Cereal	1,400	$1.10
	Beef	600	$2.50
	Doughnuts	500	$0.75

If year 1 is the base year, what is the constant-dollar real growth rate from year 1 to year 2?
If year 2 is the base year, what is the constant-dollar real growth rate from year 1 to year 2?
If year 1 is the base year, what is the GDP deflator in year 2?
If year 1 is the base year, what is the consumer price index (CPI) in year 2?
If year 1 is the base year, what is the inflation rate between year 1 and 2?

Expert Solution

Rahul Sunny answered 2 years ago

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