Please help me Government survey takers noted the following prices each year for
ID: 1209684 • Letter: P
Question
Please help me
Government survey takers noted the following prices each year for the listed items.
Items
2010
2011
2012
Pizza
$10
$20
$10
Phone Service
$90
$180
$90
Crude Oil (barrel)
$90
$180
$90
Wholesale TV
$210
$420
$210
Calculate the percentage increase in PPI from the base year, 2010 to 2011.
Calculate the percentage increase in CPI from the base year, 2011 to 2012.
Explain why long term interest rates would most likely to increase from 2010 to 2011.
What is likely to happen to CPI if the unemployment rate continues to decline
Items
2010
2011
2012
Pizza
$10
$20
$10
Phone Service
$90
$180
$90
Crude Oil (barrel)
$90
$180
$90
Wholesale TV
$210
$420
$210
Explanation / Answer
Calculate the percentage increase in PPI from the base year, 2010 to 2011.
13%
Calculate the percentage increase in CPI from the base year, 2011 to 2012.
(50%)
PPI has increased over 100% in 2011 from 2010, and at the same period CPI has increased over only 5%. Hence this economy seems to look as a inflationary economy, and expects the long term interets rates to be on a higher side
CPI has decreased in 2012, and if the unemployment rate continues to decline, the CPI rate is going to further reduce in coming years
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