Using the quantities from 2006 for your market basket, and 2006 as your base year, calculate the CPI for 2006, 2007 and 2008.

Interactive activity

Learning Outcomes:
Compare and contrast an open and a closed economy.
Define balanced trade

Action Required:

Read the article by using the following link:

https://oxfordbusinessgroup.com/analysis/come-one-come-all-vision-2030-aims-establish-more-open-and-inviting-economy

Test your Knowledge (Question):

Closed or Open Economy which one is targeted under the Saudi Vision 2030 and why?

Instructions
Answer the given question in your own word and it should be approximately 120 words.

Year Price of Pizza Quantity of Pizza Price of Burger Quantity of Burger Price of coffee Quantity of Coffee
2006 $ 4 200 $ 6 125 $ 8 100
2007 $ 6 350 $ 8 200 $ 9 175
2008 $ 7 600 $ 9 350 $ 12
Q2. Suppose people consume 3 different goods. The following table shows the prices and quantities of each good consumed in 2006, 2007, and 2008.

Using the quantities from 2006 for your market basket, and 2006 as your base year, calculate the CPI for 2006, 2007 and 2008. (2 Marks)

Using the CPI calculate the rate of inflation. (1 Mark)

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