Consider the year-to-year inflation rates in Atlantis

2000 10%

2001 20%

2002 15%

2003 10%

(i) Fill in the table below. All the data have been measured at the end of each year

Year Nominal Wage

1999 $ 15.00

2000 $ 17.60

2001 $ 19.80

2002 $ 20.10

2003 $ 22.21

CPI (base 1999) 100

Calculate CPI for 2000, 2001, 2002, 2003

Real Wage 1999 $15.00

Calculate real wage for 2000, 2001, 2002, 2003

(ii) Consider the years 1999 and 2003: Given the nominal wages in 1999 and 2003, what must be the value of the 2003 CPI so that the workers earn the same real wage in 1999 and 2003?