The tables above give the purchases of an average consumer in a small economy. (These consumers purchase only shampoo and pizza.) Suppose 2015 is the reference base period
a) What is the cost of the CPI basket in 2015 and 2016?
b) What is the CPI in 2015 and in 2016?
c) What is the inflation rate between 2015 and 2016?
a) For 2015 the CPI basket costs $171.25. For 2016 the CPI basket costs $178.75.
b) For 2015, the base period, the CPI is 100.0. For 2016 the CPI is ($178.75/$171.25 ) × 100, which is 104.4.
c) Between the two years the inflation rate is equal to [(104.4 - 100.0 )/100] × 100, which is 4.4 percent.
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If N is the working-age population, Q is the labor force, and U is the number of unemployed, then the unemployment rate is measured as
A) U/N B) U/Q C) U/(N-Q) D) Q/N
The MU/P equalization principle means consumers will exhaust their expenditure budget so that, in the end, the MU/P ratio is:
a. zero for each good. b. higher for goods the consumer wants the most. c. maximized for the goods the consumer wants the most. d. higher than TU/P. e. the same for each good.
Of the collection of supply and demand diagrams in Figure 2.2, which one shows the result of an increase in the population of the group of people likely to buy a good?
A. Figure 1 B. Figure 2 C. Figure 3 D. Figure 4
The unregulated monopoly in the figure below will earn profit of: 
A. $16. B. $0. C. $4. D. $8.