Consider the table below. Compute for the GDP deflator and the two means of computing the inflation rate. You may use Excel but do place your answers in the table below. GDP (current prices) GDP (constant 2018 prices) Consumer Price Index Year Inflation (CPI) Inflation (GDP (2018 prices) Deflator) 3697556 6985383 52.1 2000 4024399 7198384 55.2 2001 4350560 7465894 57.0 2002 4717809 7845677 58.5 2003 5323904 8361078 60.9 2004 5917282 8774325 64.7 2005 6550417 9240804 68.1 2006 7198245 9843239 70.1 2007 8050201 10270878 74.2 2008 8390421 10419633 77.3 2009 9399451 11183861 80.1 2010 10144661 11615360 83.6 2011 11060589 12416466 86.7 2012 12050592 13254644 89.0 2013 13206828 14096047 91.3 2014 13944157 14990907 92.3 2015 15132381 16062676 93.7 2016 16556651 17175978 96.0 2017 18265190 18265190 100.0 2018 19517863 19382751 103.4 2019 17951574 17537843 106.9 2020 19410614 18540084 110.0 2021 22024515 19943630 114.4 2022 a. Plot the two computations of inflation rate over time and describe the patterns you observe. (5 pts) b. Given the data on inflation, which of the two methods to estimate inflation are used to compute for the real GDP? You may use Excel to verify your answer (5 pts) c. Are there specific advantages or disadvantages in using either of the two inflation metrics? (3 pts) 2. Consider the production function of Medieval Europe as follows: Y = 10.77 p0.23 Where Y is total output, L is units labor, and P is units of land. If L = 750 units of labor, and P = 270 units of land, a. How much does the economy produce? (2 pts) b. What are the factor share of land and labor to output? (2 pts) c. Assuming the bubonic plague takes half of the continent's population, what is the new level of output? (2 pts) d. Derive the marginal product of labor (3 pts) 3. Consider the production function of a closed economy below: Y = F(AL, K) = AL/3 K2/3 Where the typical notations apply; L is units of labor, K is units of capital, A is the productivity parameter. Hold A fixed at 1. a. What is total output if there are 350 units of labor and 720 units of capital? (1 pt) b. Show what kind of returns to scale the function exhibits. (2 pts) c. Derive the marginal product of Labor (3 pts) d. Derive the marginal product of Capital (3 pts) 4. Rewrite the production function from item 3 in terms of per effective worker. a. What is the new production function? (show the process) (2 pt) b. Assuming that the depreciation rate is 2%, the population growth rate is 1.2%, and technological progress is 3% (annually), find the golden steady-state value for k and y, and the golden steady-state rate of savings. Show your complete solution (12 pts)