1. The Consumer Expenditure Survey finds that a typical consumer in the U.S. buys 50 litres of soda and 80 small pizzas each year. In 2011 a litre of soda cost $1 and a small pizza cost $5. In 2016 a litre of soda cost $1.20 and a small pizza cost $6. A. Using 2011 as the base year, what is the CPI in 2011? B. Using 2011 as the base year, what is the CPI in 2016? C. Calculate inflation between 2011 and 2016. D. If you were making $10/hr in 2011, how much would you have to make in 2016 for your purchasing power to remain constant? 2. True or False; Explain: The CPI is a better indicator of the price level than the GDP deflator. 3. Canadia, a small country between the US and Canada, produces only maple syrup and hot cocoa. A typical household consumes is 10 liters of maple syrup and 20 gallons of hot cocoa per year, and the table below shows Canadia's production of maple syrup and hot cocoa from 2010 through 2012: Maple Syrup Hot Cocoa Quantity (liters) Price Quantity (gallons) Price 2010 100 $20 200 $5 2011 120 $25 400 $8