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Created by Sophia Lynch
almost 5 years ago
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Question | Answer |
The inflation rate is the percentage change in what? | The price level. |
What does each element in this formula mean? | Pt = Price level THIS period |
The 'Fisher Effect' describes what? | The relationship between the nominal interest rate and the real interest rate. |
What does each element in this formula mean? | |
What are two ways to measure inflation? | CPI Index and the GDP Deflator |
What are 2 differences between the CPI Index and the GDP Deflator? | 1. CPI includes some foreign goods (imports) while GDP Deflator does not 2. CPI basket is fixed (barely changes) but GDP Deflator measures the price of all goods and services currently produced. |
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