QUESTION 1 In an imaginary economy, consumers buy only sandwiches and magazines.

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QUESTION 1 In an imaginary economy, consumers buy only sandwiches and magazines. The fixed basket consists of 20 sandwiches and 30 magazines. In 2006, a sandwich cost $4 and a magazine cost $2. In 2007, a sandwich cost S5. The base year is 2006. If the inflation rate in 2007 was 16 percent, then how much did a magazine cost in 2007? a. S3.00 b. $1.87 c. $2.32 d. $2.08 QUESTION 2 In 201 1 the imaginary nation of Maconia had a population of 8,200 and real GDP of 210,500. Maconia had 5% growth in real GDP per person. In 2012 it had a population of 8,400. To the nearest dollar what was real GDP in Maconia in 2012? a. None of the above is correct. b, 216,815 c. 221,025 d. 226,416

Explanation / Answer

ans1 option d is correct

ans 2 option d is correct

ans 3 option b is correct the inflation rate eight percent and the nominal interest rate was eleven percent.

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