Suppose the CPI last year was 82.3 and this year is 90.9. Based on this information, we can calculate that the inflation rate in 1981 was
A) 10.4 percent.
B) 8.6 percent.
C) 90.9 percent.
D) 82.3 percent.
E) 9.09 percent.
A
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Suppose a price index is formed to measure changes in the price level between 1999 to 2005. A price index based on changes in the cost of the basket of goods purchased by the typical consumer in 2005 is called a
a. relative price index. b. consumer price index. c. Laspeyres price index. d. Paasche price index.
Market demand curves are obtained by
A) observing the behavior of an individual consumer in a market. B) observing the prices and quantities sold in a market over time and plotting those price-quantity combinations in a graph. C) averaging the quantities every consumer is willing to buy at each different price. D) summing the quantities every consumer is willing to buy at each different price. E) determining the price each consumer is willing to pay for the good and summing those prices across all consumers.
Trickle-down" which argues that the benefits of policies (tax cuts, etc.) which positively impact higher-income households and businesses, eventually will trickle down to those in lower income brackets and stimulate the economy.
What will be an ideal response?
Refer to the given data. If the Fed reduced the reserve requirement from 20 percent to 16 percent, excess reserves in the commercial banking system would increase by _____ and the monetary multiplier would rise to ____.
Answer the question on the basis of the following consolidated balance sheet of the
commercial banking system. Assume that the reserve requirement is 20 percent. All figures
are in billions and each question should be answered independently of changes specified in all
preceding ones.
A. $10 billion; 5
B. $40 billion; 6.25
C. $10 billion; 10
D. $40 billion; 12.5