The inflation rate is the
A) difference between the current period CPI and the base period CPI.
B) percentage change in the composition of the CPI market basket from the base year to the next year.
C) difference in the price level from one year to the next multiplied by 100.
D) difference between the base period CPI and the current period CPI.
E) percentage change in the CPI from one year to the next year.
E
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Refer to Figure 4.8. If half of your friends go to the beach and half go to the park, and you decide to go to the park, then
A) your friends at the beach will switch to the park. B) you and your friends at the park will switch to the beach. C) your friends at the beach will switch to the park and your friends at the park will switch to the beach. D) your friends will all stay where they are.
Empirical evidence shows that the short-run Phillips curve was vertical during the 1950s and 1960s
Indicate whether the statement is true or false
Suppose the cost of raw materials used by the cotton industry rises to a larger extent compared to the increase in demand in the market. Which of the following situations will arise?
a. The incidence of the higher cost will fall completely on the consumers. b. The incidence of the higher cost will fall completely on the high cost firms. c. The incidence of the higher cost will fall completely on the low cost firms. d. The incidence of the higher cost will fall partially on the consumers and partially on the sellers.
The monopoly's marginal revenue curve
a. is equivalent to its demand curve b. lies below its demand curve c. is perfectly elastic d. is perfectly inelastic e. has a positive slope