The consumer price index (CPI)
A) compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2.
B) compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period.
C) measures the increase in the prices of the goods included in GDP.
D) is the ratio of the average price of a typical basket of goods to the cost of producing those goods.
B
You might also like to view...
John is trying to decide how to divide his time between his job as a stocker in the local grocery store, which pays $7 per hour for as many hours as he chooses to work, and cleaning windows for the businesses downtown. He makes $2 for every window he cleans. John is indifferent between the two tasks, and the number of windows he can clean depends on how many hours he spends cleaning in a day, as shown in the table below:Hours PerDay CleaningWindowsTotal Numberof WindowsCleaned0017211314416517The first hour John spends cleaning windows costs him ________ that he could have earned in the grocery store.
A. $18 B. $14 C. $2 D. $7
Which of the following would increase the size of the government purchases multiplier?
A) an increase in the quantity of imports purchased by households from an increase in income B) a decrease in the amount saved by households from an increase in income C) an increase in the tax rate D) a decrease in the amount of consumption spending by households from an increase in income
Suppose that the market for fresh California navel oranges is in equilibrium and then an unanticipated freeze destroys half of the California navel orange crop. Assuming all other factors affecting supply or demand remain unchanged, how would you expect this event to change the market equilibrium for California navel oranges?
a. The demand for navel oranges would decrease resulting in a lower market equilibrium price and quantity. b. The supply of navel oranges would decrease resulting in a higher market equilibrium price and a lower market equilibrium quantity. c. Both supply and demand would increase, resulting in an increase in equilibrium quantity and an indeterminate change in price. d. Both supply and demand would decrease, resulting in a decrease in both equilibrium quantity and price.
A U.S. firm called EcoWind produces windmills for households to generate electricity. It uses 25,000 recently obtained pesos to buy copper from a mining company in Argentina. As a result of this exchange, by how much, if at all, and in which direction did: A. U.S. net exports change? B. U.S. net capital outflow change?