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1. (Excel Problem) Download annual nominal and real (chain-weighted) GDP for the period 1929-2017 here (a) Create a column for the GDP deflator and plot

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1. (Excel Problem) Download annual nominal and real (chain-weighted) GDP for the period 1929-2017 here (a) Create a column for the GDP deflator and plot it against time. (b) Create a column for the inflation rate using the GDP deflator series above and plot this series against time. (c) What is the lowest inflation rate that you observe? From which periods (t to + + 1) did it take place? (d) What is the highest inflation rate that you observe? From which periods (t to + + 1) did it take place? (e) What was the highest rate of inflation after WWII and when did it take place? (f) Calculate the average (geometric) rate of inflation from 1960 to 2019. Plot this number on your inflation graph as a horizontal line from 1960 to 2019. Is current inflation above or below this average?2. Consider an economy that produces only three types of goods: computers, oranges, and opera tickets. Below are the data on production and prices for 2018 (the base year) and 2019: 2018 2019 Goods Q P Q P Computers 3 units $500per unit 4 units $400 per unit Oranges 200 units $0.5 per unit 200 units $0.5 per unit Opera 1,000 tickets $60 per ticket 900 tickets $70 per ticket (a) Find nominal GDP in 2018 and in 2019. What is the percentage increase in nominal GDP from 2018 to 2019? (b) Assuming that 2018 is the base year, calculate real GDP in 2018 and in 2019. Does real GDP increase between these two years? (c) Compute the chain-weighted real GDP growth rate. (d) Find the GDP deflator for 2019. By what percentage does the price level change from the base year to 2019? (e) Assuming that the consumption basket used to calculate the CPI consists of 3 computers, 200 oranges, and 1,000 opera tickets, use the CPI to calculate the rate of inflation between 2018 and 2019

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