Unemployment and Inflation - Odessa College Charlotte Chea Learning Objective: Total: 40 points Define and measure unemployment rate and inflation rate Solve questions on page 3 Use page 1 and 2 as guidance Example 1: Formulae: , Price of Basket in Current Year Price of Basket in Base Year x 100 Inflation Rate CPI-CPI- X 100 CPI-1 t: current year t-1: previous year I. In 2008 the price index was calculated at 165.2 with 2005 as the base year. In 2009 the price index increased to 181.6. What was the inflation from 2008-2009? Answer: 181.6 - 165.2 165.2 x 100 -9.9% II. Given the table below, what is the price index for 2013, with 2012 as the base year having a price index of 100. (Round your answer to the nearest whole number). Items Quantity in Basket 2012 Price 2013 Price Cake 3 S12 $13 Pie 4 $8 $10 Cupcake 10 $2 $2.5 Answer: (3 +13) + (4 + 10) + (10+ 2.5) x 100 118 (312) + (4 + 8) + (10 + 2) Unemployment and Inflation - Odessa College Charlotte Chea Important: Show all your calculation work for full credit. No credit will be given if step by step calculation work is not shown. Points will be deducted if file uploaded is disorganized. Question 1: I. In 2008 the price index was calculated at 145 with 2005 as the base year. In 2009 the price index increased to 180. What was the inflation from 2008-2009? (10 points) II. Given the table below, what is the price index for 2013, with 2012 as the base year having a price index of 100. (Round your answer to the nearest whole number). (10 points) Items Cake Pie Cupcake Quantity in Basket 2012 Price 2013 Price 3 $11 $13 4 $5 $9 10 $2 $4