3. /15 Points) Inflation a. Fill out the following tables to practice calculating the CPI for different base years 15) Year Market Basket Base Year 2006 Base Year 2007 Base Year 2008 2006 $20 2007 $40 2008 $50 Year Market Basket Base Year 2009 Base Year 2010 Base Year 2011 2009 $40 2010 125 2011 200 b. Explain the difference between demand pull and cost push inflation. Define the velocity of money. Use the quantity theory of money to explain what happens when the government prints money to fund governing. ( 15) c. Identify how to calculate nominal interest rates and real interest rates. Assume that you put $100 in the bank. Use numeric examples to explain three different scenarios in which the REAL interest rate is positive, stays the same, and is negative. ( /5)