Home / All Edu Topics / ECO403 Macroeconomics Assignment# 1

ECO403 Macroeconomics Assignment# 1

eco403 ASSIGNMENT NO 1 FALL 2016,eco403 FALL 2016 ASSIGNMENT NO 1 eco403 SOLVED ASSIGNMENT NO 1,eco403 FALL 2016 ASSIGNMENT NO 1 SOLVED,

ECO403 Macroeconomics Assignment# 1

ECO403 Macroeconomics Assignment# 1 last date 29/11/16

Economic growth and inflation are two most important macroeconomic factors affecting an economy. The main objective of the macroeconomic policy makers is the high and sustained economic growth with low inflation rate. The relationship between economic growth as measured by GDP; and inflation rate as measured by CPI or GDP deflator; depends on the economic situation of the economy. High economic growth or GDP, without an increase in inflation rate, is possible if the potential output of the economy is growing enough to keep pace with demand. If demand increases continuously, and the productive capacity or GDP does not expand, there is a danger of rapid increase in general price level in the long run leading to high inflation rate in the economy.

Requirement # 1

Suppose an economy produces only two goods; apples and oranges. Calculate the following by using information given in the table.

a. Nominal GDP for year 2010
b. Real GDP for year 2010 by taking 2009 as base year c. GDP deflator for year 2010

image:

page1image17880image:

page1image18040

Year 2009

image:

page1image21656

Year 2010

Goods

Price (Rs.)

image:

page1image24536

Quantity

Price (Rs.)

image:

page1image27288

Quantity

Apples

200

130

245

160

Oranges

350

150

430

170

Requirement # 2

(Marks: 1.5+1.5+2)

image:

page2image3264

Calculate the cost of basket, Consumer Price Index (CPI), and inflation rate by using information given in the table.

Price (Rs.)

Quantity

Years

Apples

Oranges

Apples

Oranges

Cost of basket

CPI

Inflation rate

2009

200

350

130

150

?

?

—-

2010

image:

page2image38864

245

430

image:

page2image41520

160

image:

page2image43536

170

?

image:

page2image46200image:

page2image46792

?

?

(Marks: 1+1+1+1+1)

Read more at http://vustudents.ning.com/group/eco403macroeconomics/forum/topics/assignment-no-1-last-date-29-11-16#PSCKkFhspTo2kmc9.99

About admin

Check Also

ENGLISH CODE 386 AIOU SOLVED ASSIGNMENT 1 SPRING 2017

English code 386 aiou solved assignment 1 spring 2017 will be upload now. The assignment …

Leave a Reply

%d bloggers like this: