Inflation and Analyses of Monetary Policies, assignment help

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Purpose of Assignment

This assignment will introduce students to the U.S. Department of Labor's Bureau of Labor Statistics (BLS) data and provide students with the skills to calculate inflation and interpret the Consumer Price Index (CPI). Note: The BLS is the primary source of information on inflation, but their data is re-posted in other sources, such as the St. Louis Federal Reserve FRED site, among others.

Assignment Steps

Resources: Tutorial help on Excel® and Word functions can be found on the Microsoft® Office website. There are also additional tutorials via the web offering support for Office products.

Use an internet search or the University Library to locate information on the Consumer Price Index (CPI). Internet sites you might find useful include the Bureau of Labor Statistics (BLS) and the Federal Reserve of St. Louis FRED web site although you are allowed to use other sources.

Develop a minimum 700-word analysis of inflation by including the following:

  • Choose a product or service you currently consume/use, such as apparel or educational services, that is included in the CPI's "market basket." Find the annual CPI index numbers for your chosen good or service for the years 1995, 2005, 2010, and 2015. Enter those index numbers in an Excel® file and calculate the percent change (inflation rates) in those index numbers from 1995 to 2005, from 1995 to 2010, and from 1995 to 2015.
  • Analyze the trends in overall inflation over the last five years and whether your income has kept pace with inflation. How has inflation over the last five years affected you and/or your family?
  • Discuss how a business manager, such as a human resources manager, might use CPI statistics.
  • Include 3 Graphs

Practice the following pattern in your paragraph construction: 1) assertion, 2) reasons for or explanation of the assertion, and 3) evidence for the assertion. If you are particularly energetic, a fourth element is 4) application of economic theory to real world issues involving career, financial planning, business, or politics.

Cite a minimum of three scholarly, peer-reviewed references.

Format your paper consistent with APA guidelines.

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Explanation & Answer

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INFLATION AND ANALYSES OF MONETARY POLICIES

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1

INFLATION AND ANALYSES OF MONETARY POLICIES

Inflation and Analyses of Monetary Policies

Inflation refers to rise in products prices especially those in consumer basket. The
analysis below shows that the prices of goods has been rising over the years and to be precise,
since the year 1995 to 2015. The fives will under focus to help in computing inflation.
𝐼𝑛𝑓𝑙𝑎𝑡𝑖𝑜𝑛 = [{𝐶𝑃𝐼1 − 𝐶𝑃𝐼0 }/𝐶𝑃𝐼0 ] ∗ 100
The formulae above aid in calculation of inflation
Where CPI0 represent previous year
CPI1 represents the following year.
The Consumer Price Index (CPI) is a measure that analyzes the weighted average of costs
of a basket of buyer merchandise and services, for example, transportation, food and medicinal
care. It is computed by taking value changes for every item in the foreordained basket of
products and averaging them. Changes in the CPI are utilized to survey value changes related
with the average cost for basic items; the CPI is the most reliable item and thus the most
employed by the governments to distin...


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