Question: Consider the price index below. What are the values for A, B, and C? Was there inflation from 2006 to 2009? If the price changes above occurred for all goods across the economy during the four year period, explain how nominal GDP and real GDP would differ.
Consumer Price Index [pound of corn]
| Year |
Current Price
|
Base Year Price
|
Price Index
|
| 2006 |
81.00
|
81.00
|
100
|
| 2007 |
81.25
|
A
|
125
|
| 2008 |
91.34
|
81.00
|
B
|
| 2009 |
C
|
81.00
|
146
|