Using a Laspeyres index to calculate the Consumer Price Index (CPI)
A) weights quantities with current prices.
B) weights prices with base-year quantities.
C) weights quantities with base-year prices.
D) weights prices with current year quantities.
B
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If GDP grows at a rate of 3% per year, approximately how long will it take for GDP to double in size?
A) 12 years B) 21 years C) 23 years D) 35 years
Evidence indicates that there's a strong relationship between money and inflation in:
A) both the short and long run B) neither the short nor the long run C) short run, but not the long run D) long run, but not the short run
The price of lemonade is $0.50; the price of popcorn is $1.00. If Fred has maximized his utility by purchasing lemonade and popcorn, his marginal rate of substitution will be:
A) 2 lemonades for each popcorn. B) 1 lemonades for each popcorn. C) 1/2 lemonade for each popcorn. D) indeterminate unless more information on Fred's marginal utilities is provided.
A policy reaction function describes how the action a policymaker takes depends on:
A. the political affiliation of the policymaker. B. the state of the economy. C. the reaction of special interest groups. D. public approval ratings.