1. Calculate the labor force participation rate for a hypothetical country with an adult population of 50 million, of which 30 million are employed, 1.5 million are unemployed, and 18.5 million are not in the labor force. Show your calculations and express the answer as a percentage. Discuss the implications of a high or low labor force participation rate for an economy. Also calculate unemployment rate. [2 marks] 2. Explain why a short-order cook who loses their job when a new restaurant open is likely to find another job quickly. [1 Marks] 3. Develop a personalized student price index by following the instructions below: [3 Marks] Choose at least 5 different products that you purchase in your daily life and be specific in naming them. For example, you can choose petrol and vegetables etc. Pick a specific quantity for each product. For example, you might choose to buy 30 litres of petrol or 5kg of onion, or tomato. Find the actual price of each product in your local market or store. Calculate the total cost of buying these products by multiplying the quantity by the price for each item. Discuss the implications of this exercise on market basket selection for price indices, and which goods are likely to change price frequently. Save a copy of this assignment for future reference as you may use the prices to calculate inflation rates later in the term. Provide a brief write-up on your experience in completing this assignment and how it has enhanced your understanding of price indices and market basket selection. Note: Observation period is one week. 4. Topic: CPI and inflation [3 Marks] Purpose: This assignment aims to help students understand how to calculate the Consumer Price Index (CPI) and use it to measure inflation. Instructions: Using the given example, calculate the CPI and inflation rate for the following scenario: The fixed basket of goods consists of 50 kg rice, 10 litres of milk, and 5 kg of onions. The prices of the goods in two years are as follows: In 2021, the prices are: 1 kg rice for INR 50, 1 litre of milk for INR 40, and 1 kg of onions for INR 20. In 2022, the prices are: 1 kg rice for INR 55, 1 litre of milk for INR 50, and 1 kg of onions for INR 25. Based on the information given, answer the following questions: a. What is the cost of the basket of goods in 2021 and 2022? b. What is the CPI for 2021 and 2022? Which year is the base year? c. What is the inflation rate from 2021 to 2022? Discuss the limitations of using a fixed basket of goods to measure inflation, such as changes in quality, substitution effect, and the inclusion of new products. You can also compare the CPI with other measures of inflation, such as the Gross Domestic Product Deflator (GDP Deflator). 5. The table below shows the market price and quantity of each product in three different years: 2016, 2017, and 2018. [2 marks] Year 2016 2017 2018 Price of footballs 10 12 14 Quantity of footballs 120 200 180 Price of rugby balls 312 15 318 Quantity of rugby balls a) Calculate the nominal GDP for each year using the given prices and quantities. b) Calculate the real GDP for each year, using 2016 as the base year. c) Calculate the GDP deflator for each year. d) Interpret the results. Which year had the highest inflation rate? What does the GDP deflator tell us about the changes in prices in the economy over time? 6. amount in year T X 200 300 275 Economists ignore the rise in people's incomes that is caused by higher prices. Why? Why do we concern about read GDP not Nominal GDP? [1 Marks] 7. GDP factor cost=400; Depreciation=50; Net Indirect Taxes=20; Net Factor Income from Abroad (NFIA)= 10 Calculate NDP, NNP AT Factor cost and NDP, NNP at Market Price. [1 Marks] 8. To find out whether Gas cylinder was cheaper in real terms in 2012: [2 marks] Let's suppose non-subsidized gas cylinder was coming in 710 Rs. In 2012. Find CPI of 2012 and 2021. compare with current price. Amount in today's Rupees = the price level today the price level in year T