1.A change in consumer prices causes the CPI to increase to 175, up from its previous level of 125. Determine the percent change in consumer prices this change represents.

a. 25%

b. 40%

c. 50%

d. 60%

e. 75%.

2.Beta is a relatively small country with a 2010 Nominal GDP of $10,000. With 2005 as the base year and a 2005 CPI of 125, what is Beta's Real GDP in 2005 dollars?

a. $4,000

b. $7,500

c. $8,000

d. $10,000

e. $12,000