I have 7 questions for macroeconomics.

Ch. 5 Questions:

1. What is the Fisher Effect and why is it important?

2. Suppose the nominal GDP of Iceland is $24 billion while the real GDP is $20 billion. Use the GDP Deflator to calculate inflation () over this time. Explain your answer.

3. If a basket of goods today (2019) costs $80 but would have cost $60 in the base year (2012), what is the CPI?

Ch. 6 Questions:

1. List and describe the 3 functions of money.

2. List and describe the 4 characteristics of money.

3. Why is the nominal interest rate referred to as the "price" of money? Why might we choose to hold money balances anyway?

4. Explain animal spirits in your own words.