Assignment 2: LASA 1: Inflation and Government Economic Policies
Inflation
is a measure of how prices have changed over time. If prices are changing
due to inflation, each dollar spent will buy less.
In order to answer the
questions below, go to the following website: http://www.bls.gov/cpi/
Questions:
1. What is
inflation? What are the causes of inflation? Is inflation desirable and
what can be done to control inflation in a market economy?
2. What is the Consumer
Price Index (CPI)? How has the CPI behaved since the year 2000?
What have been the causes of these changes? In your response, include a graph
of the CPI for this period and cite your source.
3. What is the Producer
Price Index (PPI)? How has the PPI behaved since the year 2000?
What have been the causes of these changes? In your response, include a graph
of the PPI for this period and cite your source.
4. What is the Consumer
Expenditure Survey (CE)? How has the Survey behaved since the year
2000? What have been the causes of these changes? In your response,
include a graph of the CE for this period and cite your source.
5. What do the measures
above tell us about consumer behavior? Have incomes changed enough to
offset the inflation since 2000? What can we predict about future
inflation?
6. What are the
implications of these measures for government economic policies?
By
Wednesday, February 26, 2014, create a Microsoft Word file to collate
your answers and submit it to the M3: Assignment 2 Dropbox.
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Assignment
2 Grading Criteria
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Maximum Points
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Explained
inflation. Identified the causes of inflation. Explained whether or not
inflation is desirable and offered a rationale. Identified ways to control
inflation in a market economy.
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40
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Explained
the Consumer Price Index (CPI). (8 points)
Outlined
the CPI behavior since the year 2000. (8 points)
Identified
the causes of the changes in the CPI over this time. (8 points)
Provided
a graph of the CPI for this period and cited the source. (8 points)
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32
|
|
Explained
the Producer Price Index (PPI). (8 points.)
Outlined
the PPI behavior since the year 2000. (8 points)
Identified
the causes of the changes in the PPI over this time. (8 points)
Provided
a graph of the PPI for this period and cited the source. (8 points)
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32
|
|
Explained
the Consumer Expenditure Survey (CE). (7 points)
Outlined
the CE behavior since the year 2000. (7 points)
Identified
the causes of the changes in the CE over this time. (7 points)
Provided
a graph of the CE for this period and cited the source. (7 points)
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28
|
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Explained
what the CPI, PPI, and CE measures can tell us about consumer behavior.
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8
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Identified
changes in income since 2000.
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4
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Explained
whether or not the changes in income offset the inflation for this period.
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8
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Identified
viable predictions about future inflation.
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8
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Researched
impact of CPI, PPI, and CE measures on the economy. Discussed the
implications of these measures for government economic policies.
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20
|
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Style
(4 points): Tone, audience, and word choice.
Usage
and Mechanics (4 points): Grammar, spelling, and sentence structure.
APA
Elements (12 points): In text citations and references, paraphrasing, and
appropriate use of quotations and other elements of style.
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20
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Total:
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200
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