When a new good enters the market, the CPI
a. accounts for the change in its price immediately.
b. fails to account for the impact on living standards from the good's existence.
c. never accounts for how the good changes in price.
d. accounts for the decline in the price but not for any increases.
e. accounts for the good only if sold in populous eastern states.
B
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The bursting of the __________ market was largely responsible for setting off the Great Recession.
Fill in the blank(s) with the appropriate word(s).
Applying neoclassical theory to the housing market, the idea that "housing is a good investment" refers to ________
A) higher expected household income B) the inability to buy as much housing at a higher price C) an expected increase in the relative price of housing D) a decrease in the cost of building new houses
The vertical distance of the shift in supply from a specific tax of t amount on producers will
A) equal t. B) be less than t. C) depend on the elasticity of supply. D) depend on the incidence of the tax.
In the "Interdisciplinary Perspective" titled "A Philosophical Critique on the Marginal Utility of Money," the basic point made is that
a. the law of diminishing marginal utility does not apply to money b. marginal utility always increases at an increasing rate for money c. once basic needs are met, additional income or wealth does not increase happiness d. most of the theories advanced by economists are flawed e. the total utility function for money has a downward slope