Suppose a basket of goods and services has been selected to calculate the CPI and 2012 has been selected as the base year. In 2012, the basket's cost was $50; in 2014, the basket's cost was $52; and in 2016, the basket's cost was $55 . The value of the CPI in 2016 was
a. 90.9.
b. 104.0.
c. 105.0.
d. 110.0.
d
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Damian owns a tattoo parlor and has hired three tattoo artists to work for him. The marginal product of labor is 8 for the first artist, 12 for the second artist, and 7 for the third artist
What is Damian's average product of labor for these three tattoo artists?
Comparing the core inflation rate to the Consumer Price Index, the core inflation rate
A) controls for the biases of the CPI. B) uses current period quantities, not base period quantities. C) measures all goods produced, not just consumer goods. D) includes volatile elements not in the CPI. E) excludes the volatile elements of the CPI.
According to new classical theory, if policy is correctly anticipated, expectations are formed rationally, and wages and prices are fully flexible, then an increase in aggregate demand will change Real GDP, but not the price level
Indicate whether the statement is true or false
In reference to short-term economic fluctuations, the "peak" refers to:
A. a particularly strong and protracted expansion. B. the high point of economic activity prior to a recovery. C. a period in which the economy is growing at a rate significantly above normal. D. the high point of economic activity prior to a downturn.