How are the prices of various goods and services determined for the Consumer Price Index (CPI)?
a. By an extensive annual household survey
b. By an extensive monthly survey of stores, apartments, and owner-occupied homes
c. By an extensive annual survey of stores, apartments, and owner-occupied homes
d. By an extensive monthly household survey
e. Through the same survey used to determine the typical market basket
B
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In the kinked demand curve model, if one firm reduces its price
A) other firms will also reduce their price. B) other firms will compete on a non-price basis. C) other firms will raise their price. D) Both A and B are correct. E) Both B and C are correct.
The segmenting of customers into several small groups such as household, institutional, commercial, and industrial users, and establishing a different rate schedule for each group is known as:
a. first-degree price discrimination b. market penetration c. third-degree price discrimination d. second-degree price discrimination e. none of the above
Marginal cost curves and average cost curves are both purely upward sloping
a. True b. False Indicate whether the statement is true or false
With a downsloping demand curve and an upsloping supply curve for a product, an increase in consumer income will:
A. decrease equilibrium price and quantity if the product is a normal good. B. have no effect on equilibrium price and quantity. C. reduce the quantity demanded but not shift the demand curve. D. increase equilibrium price and quantity if the product is a normal good.