3. Inflation a. Define Consumer Price Index (CPD) and describe how to calculate the CPI.( 12) b. Given the following CPIs, what is the inflation relative to a Base Year (the base year is not provided for purposes of this question): Year A = 90, Year B = 100, Year C = 125, Year D = 150? 14) c. Using the data from 3(b) above, explain why the percent change in prices from Year C to Year D is not 25%.( /1) d. What is the formula to calculate nominal interest rates and real interest rates? /1) e. If actual inflation is greater than the anticipated inflation, who would benefit? Explain why. 12) f. If actual inflation is greater than the anticipated inflation, who would be harmed? Explain why. C 12)