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Eco 302. Name_______________________________. Problem Set 5. 28
September 2011. Mishkin, chapter 8. Business Cycles. 1. What are business
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Eco 201. Name______________________________. Test 2. 24 June 2009.
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Eco 302. Name_______________________________. Problem Set 2. 16
February 2011. Mishkin, chapter 2. 1. Suppose the following table records the
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Eco 302 Problem Set 2
Name_______________________________ 16 February 2011
Mishkin, chapter 2 1. Suppose the following table records the total output and prices for an entire economy. Suppose further that the base year in the following table is 2008. Year Price of Coke Quantity of Coke Price of Burgers Quantity of Burgers 2008 $1.00 100 $2.00 100 2009 1.50 120 2.50 80 2010 2.00 150 3.00 120 Calculate the following: a. Nominal GDP for 2008
d. Was the increase in nominal GDP from 2008 to 2009 mostly due to an increase in real output or an increase in prices?
2. The following table shows the prices and quantities of the typical market basket of goods consumed in an economy. The base year is 2008. Year
Price of Diet Coke
Quantity of Diet Coke
2008 2009 2010
1.00 1.20 1.25
30 25 20
Quantity of Quantity of Butterfinger Butterfinger Crisp Bars Crisp Bars 0.50 60 0.55 50 0.60 40
Quantity of Cell Phone Service 20.00 30.00 40.00
Quantity of Cell Phone Services 12 12 12
. Compute the cost of the fixed basket in each year. 2008: ____________________________________________________________ 2009: ____________________________________________________________ 2010: ____________________________________________________________ Make 2008 the base year and convert to calculate CPI. 2008: ____________________________________________________________ 2009: ____________________________________________________________ 2010: ____________________________________________________________
Inflation in 2009 = __________________________________________________
Inflation in 2010 = __________________________________________________
3. On 1 January 1976, the minimum wage was raised to $2.30. The CPI for January 1976 is 55.6. The CPI for December 2010 is 219.179 . What is the 1976 minimum wage in December 2010 dollars?
