In 1950, your grandfather\'s salary was $6,000; in 1960 it was $7,000; and in 19
ID: 1102925 • Letter: I
Question
In 1950, your grandfather's salary was $6,000; in 1960 it was $7,000; and in 1970, it was $8,500. If the CPI was 24.1 in 1950, 29.6 in 1960 and 38.8 in 1970, then in real terms, your grandfather's salary was the highest in
a 1960 and lowest in 1950. Question 20 1 pts Table 1 The table below contains data for the country of Sweetland, which produces only chocolate and sponge cake. The base year is 2009 Prices and Quantities Year Price of a bar of chocolate $3.00 $2.50 $3.00 $4.00 Quantity of chocolate (in bars) Quantity of sponge cakes 900 1230 1560 1300 Price of 1 sponge cake 2009 2010 2011 2012 1050 1200 1450 1800 $2.50 $3.50 $4.00 $5.50 Refer to Table 1. What is the GDP Deflator for the year 2011? O 100 69.7 0 77.9 O 128.4Explanation / Answer
20.
nominal GDP of 2011=3*1450+4*1560=10590
real GDP of 2011=3*1450+2.50*1560=8250
GDP deflator=nominal GDP of 2011/real GDP of 2011*100
=(10590/8250)*100
=128.4
the above is the answer
21.
rate of inflation from 2010 to 2011
=((3*1050+4*900)/(2.50*1050+3.50*900))-1
=17%
the above is the answer
22.
assuming 1950 as base year, then in real terms 1950 salary=6000
in real terms, 1960 salary=7000*24.1/29.6=5699
in real terms, 1970 salary=8500*24.1/38.8=5280
so answer is 1950 and lowest in 1970.
the above are the answers