Take Quiz Quiz Instructions HW on Inflation Due by 1pm on Thursday You get two attempts, Your best score will be used. D Question 1 1 pts The is a measure of the price level based on the consumption patterns of typical consumers O Typical Consumer Index Current Price Index Consumption Function Consumer Price Index D Question 2 1 pts The following table shows the typical market basket consumed in an economy as well as data on price for years 2001 to 2003. Use this table to calculate the total expenditures i.e. price of the entire basket for 2003. Price in year Price in year Price in Year Items Quantities 200 2002 2003 Pizza 10 $10 $12 $11 T-shirts 10 $20 $25 $26 Candy 100 0.50 $0.55 $1 O $38 O $340 $470 O $4560 D Question 3 1 ptsTake Quiz O $4560 D Question 3 1 pts The following table shows the typical market basket consumed in an economy as well as data on price for years 2001 to 2003. Use this table to calculate the CPI for 2003. Assume 2003 is the base year. Price in year Price in year Price in Year tems Quantities 2001 2002 2003 Apples 10 $10 $12 $11 Bandanas 5 $20 $25 $26 Crayons 100 0.50 0.55 $1 38 O 340 100 O 73.53 D Question 4 1 pts The following table shows the typical market basket consumed in an economy as well as data on price for years 2001 to 2003. Use this table to calculate the CPI for 2002. Assume 2003 is the base year. Price in year Price in year Price in Year Items Quantities 2001 2002 2003 Apples 10 $10 $12 $11 Bandanas $20 $25 $26 Crayons 100 0.50 0.55 $1 O 73.53 O 88.24 100 120D Question 5 1 pts The following table shows the typical market basket consumed in an economy as well as data on price for years 2001 to 2003. Use this table to calculate the CPI for 2003. Assume 2002 is the base year. Price in year Price in year Price in Year Items Quantities 2001 2002 2003 Apples 10 $10 $12 $11 Bandanas 5 $20 $25 $26 Crayons 100 $0.50 $0.55 $1 83.33 O 136 O 100 O 113.33 D Question 6 1 pts The following table shows the typical market basket consumed in an economy as well as data on price for years 2001 to 2003. Use this table to calculate the inflation rate between 2002 and 2003. Assume 2001 is the base year. Price in year Price in year Price in Year Items Quantities 2001 2002 200 Apples 10 $10 $12 $11 Bandanas 5 $20 $25 $26 Crayons 100 $0.50 $0.55 $1 11.76% 20% O 16 O 13.339% D Question 7 1 ptsO 20% O 16% O 13.33% Question 7 1 pts If the Consumer Price Index rises from 140 in a year to 150 in the following year, the rate of inflation in that year is: O 10% 6.67% O 7.14% O 1.07% Question 8 1 pts If the Consumer Price Index rises from 125 in a year to 130 in the following year, the rate of inflation in that year is: 4% 0 5% 3.85% O 1.04%48 O 5% 3.85% 1.04% D Question 9 1 pts A one-pound bag of cookies cost 25 cents in 1922. If the CPI in 1922 was 17 and the CPI in 2014 is 230, convert the price of the cookies into 2014 prices. $13.52 $0.02 O $3.38 O $4.43 Question 10 1 pts If the nominal interest rate on a loan was 16 percent and the real interest rate was 10 percent, then the inflation rate during that time must have been: O 13% O 26% O 6% O 3% D Question 11 1 pts Suppose that lend inflationD Question 11 1 pts Suppose that lenders want to receive a real rate of interest of 5 percent, and that they expect inflation to remain steady at 3 percent in the coming years. Based on this, lenders should charge a nominal interest rate of: 15% O 4% 2% O 8% D Question 12 1 pts If the nominal interest rate on a one year loan was 5% and the inflation rate during the year was 3%, then the real interest rate on that loan was. O 1.67% 2% 15% O 8% D Question 13 1 pts Lower than expected inflation results in: O borrowers gaining and lenders losing borrowers and lenders both gaining borrowers and lenders both losing O borrowers losing and lenders gaining