In an imaginary economy, consumers buy only sandwiches and magazines. The fixed basket consists of 20 sandwiches and 30 magazines. In 2006, a sandwich cost $4 and a magazine cost $2 . In 2007, a sandwich cost $5 . The base year is 2006 . If the inflation rate in 2007 was 16 percent, then how much did a magazine cost in 2007?
a. $1.87
b. $2.08
c. $2.32
d. $3.00
b
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All of the following are traditional economic views except:
A. there is no such thing as a bad choice. B. choice architecture is ineffective. C. revealed preference shows researchers what the bad choices are. D. choice architects have a responsibility to remain neutral when it comes to choices.
Which of the following statements is false?
a. The largest source of state and local governments tax revenue is sales and excise taxes. b. The largest source of federal government tax revenue is individual income taxes. c. A sales tax on food is a regressive tax. d. A proportional tax is equal to a fixed dollar amount.
The U.S. Congress passed a stimulus bill in February 2009 to help remove the economy from a recessionary gap. This is an example of the use of
A) expansionary monetary policy. B) contractionary monetary policy. C) contractionary fiscal policy. D) expansionary fiscal policy.
Which of the following examples could be used to determine the net interest for a household?
a. $800 (interest paid on home mortgage) multiplied by $200 (interest paid on car loan) b. $100 (interest received from saving account) divided by $800 (interest paid on home mortgage) c. $800 (interest paid on home mortgage) plus $200 (interest paid on car loan) d. $100 (interest received from saving account) minus $800 (interest paid on home mortgage)