Prof. V. Ramey
Name ____________________________________
Econ 3
Winter 2011
Student Number ____________________________
Section___________________________________
Practice Midterm 1 (this is slightly longer than the actual one will be.)
Part I.
Short Answer.
Write your answers on this exam.
1.
(12 points)
Suppose that in Rome only two types of goods are produced and consumed,
tunics and wine.
Year
Price of tunics
(in denarius)
Quantity of
tunics produced
and consumed
Price of wine
(in denarius)
Quantity of wine
produced and
consumed
400
50
100
20
60
410
55
140
30
70
A.
What is nominal GDP in the Year 400?
___________
B.
Using the Year 400 as the base year, what is the percent increase
____________
in real GDP from Year 400 to Year 410?
C.
Again using the Year 400 as the base year, calculate the Consumer
____________
Price Index (CPI) in the Year 410.
1
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