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The following table gives the prices and quantities of items in a typical consumer basket in a $1.5 $1.2 LO 7 12 1) Base year can be any year. Using year I as the base year, calculate I) the cost of the basket in all three years, in CPI in all three years illy the annual inflation rate between year I and 2, year 2 and 1. 2) Now using year 2 as the base year, calculate In the cost of the basket in all three years. in CPI in all three years iis the annual inflation rate between year I and 2, year 2 and 3. 3) How do your answers from part iit in question I and 2 differ? Suppose the country above only produces shoes and apples domestically. The following table shows the changes in real GDP and nominal GDP for the country over the same time period. Year P. IP be LG $12 540 4) Calculate the GOP deflator in year 1, 2 and 3 for this country using year I as the base year. 5) Calculate the inflation rate between year I and 2. 6) Calculate the nominal GDP in year 1, 2 and 3 for this country. 7) Using year I as the base year, calculate the real GDP of year 1, 2 and 3 for this country. Also calculate the annual growth of real GDP over time. 8) Using year 3 as the base year, calculate the real GDP of year 1, 2 and 3 for this country. Also calculate the annual growth of real GDP over time. 9) Compare your results from 7) and 8). do you see a pattern? What is that'? 10) Using year I as the base year again, if the real potential GDP is 400. what kind of gap exists in the economy in year