Question

1.67 pts The information in the table identifies the quantities of three goods produced in a simple economy in 2018 and 2019, and the prices that the goods sold for in each of the two years. The base year is 2018 tem Quantity Price Price Quantity 2019 2018 2018 2019 12 $10 $11.79 14 Movie hickets 2 $3 $3.81 16 Bags of popcorn 16 $1 $163 Drinks of soda Based on the GDP deflator method, what was the rate of inflation between the two years? Round your answer to two decimal places. Do not enter a percent sign Next - Previous w х 5. 90 & 7 $ 4 % 5 8 9 6 3 0 P. U Y T R E W К. G H F S D N. B M

Answer 1

1)

Nominal GDP in year 2 = 4*11.79 + 6*3.81 +6*1.63 = 79.8

Real GDP in year 2(considering price of year 1) = 4*10 + 6*3 + 6*1 = 64

Inflation = 79.8/ 64 * 100 = 124.6875

Since year 1 is base

So inflation rate = (124.6875 - 100) / 100 = 24.69%

29)

Real GDP in 2011 in calculated by multiplying 2011 quantity with 2010 price ( base year price)

Real GDP in 2011 = 10.4*5 + 5.2*8+ 4.9*6 = 123 .0

30)

Required Reserves Ratio = 9.17%

Deposits = 4890

Reserves = 1135

Required reserves = 9.17%* 4890 = 448

So Excess Reserves = 1135 - 448 = 687