Suppose that a simple, imaginary economy produces only two goods: bread and apples.In addition to these two goods, the economy alsoconsumes and importschicken.Using the information below, answer the following questions

	Bread	Apples	Chicken
2019 Quantity	100	200	40
2019 Price	$2.00	$1.20	$2.00
2020 Quantity	150	210	70
2020 Price	$2.00	$1.40	$2.25

Using your GDP deflator in 2019 and 2020 and the growth rate of the deflator price index, we know in this simple economy that:

	Deflation has occurred and the value of the dollar is increasing
	Deflation has occurred and the value of the dollar is decreasing
	Inflation has occurred and the value of the dollar is decreasing
	Inflation has occurred and the value of the dollar is increasing

Question 35

0 / 2 points

Suppose that a simple, imaginary economy produces only two goods: bread and apples.In addition to these two goods, the economy alsoconsumes and importschicken.Using the information below, answer the following questions

	Bread	Apples	Chicken
2019 Quantity	100	200	40
2019 Price	$2.00	$1.20	$2.00
2020 Quantity	150	210	70
2020 Price	$2.00	$1.40	$2.25

Calculate the CPI in 2019, using 2020 as the base year.Hint:Urban households would buy all the above goods.Round two decimal places.

Answer:

(92.08)