A reason why the CPI overstates the cost of living is it
A. makes no attempt to ascertain what average people buy.
B. makes no attempt to update the market basket.
C. only measures the effects of inflation on the poor.
D. inadequately deals with updates in product lines for existing goods.
Answer: D
You might also like to view...
Rent controls typically end up
a. increasing rents received by landlords b. raising property values c. encouraging landlords to overspend for maintenance d. discouraging new housing construction e. unnecessarily increasing the long-run supply of housing
The economic way of thinking is
a. a set of historical generalizations that indicates what goods should be produced. b. a body of statistical data that indicates how an economy should be organized. c. a set of basic concepts that helps one understand human choices. d. a set of complex, highly abstract theories that provides persons skilled in statistics with the information necessary to tell others what choices they should make.
An early frost in the vineyards of Napa Valley would cause a(n)
a. increase in the demand for wine, increasing price. b. increase in the supply of wine, decreasing price. c. decrease in the demand for wine, decreasing price. d. decrease in the supply of wine, increasing price.
Only three goods are produced in an economy in the following amounts: A = 10, B = 30, C = 5
The current year per unit prices of these three goods are A = $2, B = $3, and C = $1. (Advanced analysis) Refer to the information. If the per unit prices of the three goods were each $1 in a base year used to construct a GDP price index, then real GDP in the current year is: A. $110. B. $115. C. $45. D. $160.