Go to the St. Louis Federal Reserve FRED database, and find data on real personal consumption expenditures (PCECCA) and a measure of real interest rates, the 10-year treasury inflation-indexed security (FII10). Convert the TIIS rate to “Annual” using the frequency setting. Download the data into a spreadsheet.

a) Report the level of consumption for the two most recent years of data available, and the average of the real interest rate over those two years.

b) Using the average real interest rate over the two years, calculate the value of consumption for the most recent period, in present discounted value terms to the prior year.

c) Using the average real interest rate over the two years, what is consumption for the earlier period worth in the most recent period?