Table 15-6
The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2009.
Prices and Quantities

-Refer to Table 15-6.This country's inflation rate from 2010 to 2011 was

Question

Table 15-6
The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2009.
Prices and Quantities
 
-Refer to Table 15-6.This country's inflation rate from 2010 to 2011 was

Quizplus · Accepted Answer

The inflation rate from 2010 to 2011 can be calculated using the GDP deflator formula: ((Nominal GDP/Real GDP) - 1) x 100. 
For 2010, nominal GDP = (150 x 5) + (100 x 4) = 1100 and real GDP = (100 x 5) + (100 x 4) = 900. So the GDP deflator for 2010 is ((1100/900) -1) x 100 = 22.22%. 
For 2011, nominal GDP = (200 x 6) + (150 x 5) = 1950 and real GDP = (100 x 6) + (100 x 5) = 1100. So the GDP deflator for 2011 is ((1950/1100) -1) x 100 = 77.27%. 
Therefore, the inflation rate from 2010 to 2011 is (77.27% - 22.22%) = 55.05%, which is closest to option C: 34.1%.

Table 15-6 The Table Below Contains Data for the Country of Batterland,which