Chapter 4

Question 1

Interest rate

Answer 1

(Price index in year 2−Price index in year 1)/(Price index in year 1)×100

Question 2

Real interest rate

Answer 2

Nominal interest−Inflation rate

Question 3

Unemployment rate

Answer 3

(Number of people unemployed)/(Number of people in the labour force)x100

Question 4

Output gap

Answer 4

(Actual GDP−Potential GDP)/(Potential GDP)

Question 5

CPI

Answer 5

(Year 2 basket price)/(Year 1 basket price)×100

Question 6

Labour force rate

Answer 6

(Labour force)/(Population (working age) )×100

Question 7

Real GDP percentage

Answer 7

(Nominal GDP)/(GDP deflator)×100