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Unformatted text preview: d. Why are the two output growth rates constructed in (b) and (c) different? Which one is correct? Explain your answer. 7. Use the data from problem 2 to do this problem a. Using prices in 2001 as the common set of prices to construct real GDP, compute the GDP deflator for 2001 and 2002 and the rate of inflation from 2001 to 2002. b. Redo part a using the prices for 2002 as the common set of prices. 8-10. Baumol and Blinder, p. 130-131, Test Yourself, questions 1, 4, and 5. (Note that in problem 5, you can compare your answers to the series on real hourly earnings in the back of the book. The answers wont be identical. Why?)...
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- Fall '07