The Bureau of Labor Statistics has taken several steps to reduce the bias in the consumer price index. Which of the following is not one of the steps taken to reduce the bias?
A) updating the market basket every two years, rather than every 10 years
B) using statistical methods to reduce the size of the quality bias
C) conducting a point-of-purchase survey to track where consumers actually make their purchases
D) incorporating substitutions by consumers when prices of specific products rise rapidly
D
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One reason individuals are willing to pay for information in uncertain situations is that information
A) can reduce uncertainty. B) is a way to diversify. C) is a method of insurance. D) is a method of self-insurance. E) always reduces the difference between the probabilities of possible outcomes.
The federal agency established in 1934 to regulate telephones and broadcasting industries is the:
a. Interstate Commerce Commission (ICC). b. Federal Trade Commission (FTC). c. Securities and Exchange Commission (SEC). d. Equal Employment Opportunity Commission (EEOC). e. Federal Communications Commission (FCC).
For a given money demand curve, an increase in money supply: a. drives up the real interest rate
b. lowers the opportunity cost of holding money. c. decreases the quantity of money demanded. d. drives down the price level in an economy. e. contracts the total output produced in an economy.
Exhibit 21-6 Dollars per British pound QuantityDemanded Dollarsper Pound QuantitySupplied 200 5 600 240 4 480 300 3 410 360 2 360 390 1 330 In Exhibit 21-6, the equilibrium exchange rate is:
A. 5. B. 4. C. 3. D. 2.