Explain the difference between relative price shifts and the overall inflation rate.

1.       Define inflation, and calculate the inflation rate using the consumer price index (CPI).

2.       Explain the difference between relative price shifts and the overall inflation rate.

3.       Calculate and show how incomes and wages can be adjusted for inflation.

4.       Discuss the impact of unexpected and expected inflation.

5.       Define inflation, and calculate the inflation rate using the consumer price index (CPI)

6.       Explain the difference between relative price shifts and the overall inflation rate

7.       Calculate and show how incomes and wages can be adjusted for inflation.

8.       Discuss the impact of unexpected and expected inflation.

Solution:

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