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Old 04-30-2008, 12:30 AM
h c h c is offline
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economics problem?

The table below gives the CPI and the price of gasoline in the fictitious country “Alpha” between 1995 and 2000.

http://i245.photobucket.com/albums/gg77/hoisingjai/10b.jpg

a. For each year find the inflation rate and the change in the relative price of gasoline, both from the previous year, and fill them in the appropriate columns in the table (Round the answer to the nearest tenth of a percent).

b. Were the changes in the price of gasoline over this period more likely due to inflation or to changes in the gasoline market? Explain.
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