We can conclude that there has been inflation since the base year if the GDP price index in the current year is
A) positive
B) equal to zero
C) less than 100
D) greater than 100
E) negative
D) greater than 100
Oh, there has definitely been some inflation happening if the GDP price index in the current year is greater than 100. It's kind of like when you go to the grocery store and suddenly your favorite bag of chips costs more than it did before. Inflation means prices are going up, and that's not always a good thing for our wallets. But hey, at least we have some extra funny money to laugh about!
To determine whether there has been inflation since the base year, we need to compare the GDP price index in the current year to the base year. Here's how we can get the answer:
1. Find the GDP price index in the current year: The GDP price index measures the average price level of goods and services in an economy relative to a base year. It is usually calculated by dividing the nominal GDP (current year) by the real GDP (base year) and multiplying by 100. Let's denote the GDP price index in the current year as CPI_current.
2. Compare CPI_current to 100: The base year index level is set at 100. If CPI_current is greater than 100, it means prices have increased since the base year, indicating inflation. If CPI_current is less than 100, it means prices have decreased, indicating deflation. If CPI_current is equal to 100, it means prices have remained the same, indicating no inflation or deflation.
Based on these steps, we can conclude that there has been inflation since the base year if the GDP price index in the current year is greater than 100. Therefore, the correct answer is option D) greater than 100.