(36 marks) Jun- 01 54.0 0 Jun- 02 57.0 0 Jun- 03 58.0 0 Jun- 04 58.5 0 Jun- 05 59.0 0 Jun- 06 59.0 0 Section 2. Index Numbers Table A Year Jun Jun Jun- 98 99 00 Actua 50.0 52.0 53.0 0 0 0 Prices CPI 982 1000 1000 Jun99 =1000 CPI Jun06 =1000 1060 1103 1103 | 1115 | 1127 1152 A B 1000 Using Table A, above carry out the following calculations, showing your workings: A. If the actual price of $50.00 (June 1998) was for a heater, what is the price of this heater in June 2004, if increases had been at the rate of CPI movement? (2 marks) B. Is this the actual price of the heater in 2004 an increase or decrease in real terms when compared to the inflation adjusted price? (1 mark) C. Recalculate the CPls for Jun 2001, 2003 and 2005 to the new base of Jun 2006 = 1000, i.e. values of A, B and C as shown in the table. (3 marks) D. If inflation in the year between June 2006 to June 2007 was 2.5%, what will the new Consumer Price Index be in June 2007 (using the base Jun 06 = 1000)? (1 mark) (1 E. What does the Consumer Price Index (CPI) measure? mark) (36 marks) Jun- 01 54.0 0 Jun- 02 57.0 0 Jun- 03 58.0 0 Jun- 04 58.5 0 Jun- 05 59.0 0 Jun- 06 59.0 0 Section 2. Index Numbers Table A Year Jun Jun Jun- 98 99 00 Actua 50.0 52.0 53.0 0 0 0 Prices CPI 982 1000 1000 Jun99 =1000 CPI Jun06 =1000 1060 1103 1103 | 1115 | 1127 1152 A B 1000 Using Table A, above carry out the following calculations, showing your workings: A. If the actual price of $50.00 (June 1998) was for a heater, what is the price of this heater in June 2004, if increases had been at the rate of CPI movement? (2 marks) B. Is this the actual price of the heater in 2004 an increase or decrease in real terms when compared to the inflation adjusted price? (1 mark) C. Recalculate the CPls for Jun 2001, 2003 and 2005 to the new base of Jun 2006 = 1000, i.e. values of A, B and C as shown in the table. (3 marks) D. If inflation in the year between June 2006 to June 2007 was 2.5%, what will the new Consumer Price Index be in June 2007 (using the base Jun 06 = 1000)? (1 mark) (1 E. What does the Consumer Price Index (CPI) measure? mark)