ECON 3050 HWK #1, F2015 __________________________________________Score:______
_
Print Last Name, First Name
You may print this double-sided; if you print it single-sided, BOTH pages must be stapled together in the
upper left corner in order to receive credit for the assignment. Use correct symbols on your answers
(%, $). This assignment is worth 10 points.
1. The table below gives Bob’s income and the price index for the last 4 years. Respond to parts
a. – e.using the information in the table.
Year CPI Nominal Income Real Income
1 95 $48,000
2 100 $50,000
3 106 $53,000
4 110 $56,500
a. The annual inflation rate for year 2 is ___________, rounded to the tenth.
b. The base year is year ______ because the price index is _________ in that year.
