2 In this question you look at the relationship between movements in the inflation rate and the interest rate (a) Calculate the inflation rate as the growth rate in your CPI or GDP Deflator series using t Pt Pt1 Pt1 (2) where t is the inflation rate in year t and P refers to your CPI or GDP Deflator Note, you will not have an observation for inflation for the first year of your sample 1970 0 0960983926 1971 0 106484131 1972 0 120297583 1973 0 144550898 1974 0 181233797 1975 0 222567722 1976 0 279228029 1977 0 360630866 1978 0 422298496 1979 0 523821697 1980 0 668479961 1981 0 820665289

Question

2  In this question you look at the relationship between movements in the inflation rate and the interest rate  (a) Calculate the inflation rate as the growth rate in your CPI or GDP Deflator series using  t   Pt Pt1 Pt1 (2) where t is the inflation rate in year t and P refers to your CPI or GDP Deflator  Note, you will not have an observation for inflation for the first year of your sample  1970   0 0960983926 1971   0 106484131 1972   0 120297583 1973   0 144550898 1974   0 181233797 1975   0 222567722 1976   0 279228029 1977   0 360630866 1978   0 422298496 1979   0 523821697 1980   0 668479961 1981   0 820665289

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2. In this question you look at the relationship between movements in the inflation rate and the interest rate. (a) Calculate the inflation rate as

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