Last year the price of a dozen eggs was $2, and this year the price is $2.60. Which of the following does NOT express this price change accurately?
A. The price increased 30 percent.
B. The price increased by 60 cents.
C. If this year is the base year, the index number for last year would be 130.
D. If last year was the base year, the index number for this year would be 130.
Answer: C
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The marginal utility from the first burrito Bobby consumes is larger than the marginal utility from the first taco Bobby consumes. As a result
A) tacos are an inferior good for Bobby. B) Bobby will never consume tacos. C) Bobby will consume a taco only if the price of a taco is less than the price of a burrito. D) burritos and tacos are substitute goods for Bobby.
All other factors held constant, when McDonald's raises the price of its Quarter Pounder by 50 cents,
A) there is likely to be a decrease in the quantity of Taco Bell's Chalupas demanded, assuming the Quarter Pounder and Chalupas are substitutes. B) there is likely to be an increase in demand for Taco Bell's Chalupas, assuming the Quarter Pounder and Chalupas are substitutes. C) there is likely to be a decrease in demand for Taco Bell's Chalupas, assuming the Quarter Pounder and Chalupas are substitutes. D) there is likely to be an increase in demand for McDonald's Quarter Pounder, assuming the Quarter Pounder and Chalupas are substitutes.
The income velocity of money is the absolute number of times, on average, that
A) people purchase goods and services during a year. B) each monetary unit is spent on final goods and services. C) each unit of real GDP is produced by business firms. D) each one-unit increase in the price level occurs.
Property values are determined by
a. the interest rate and expected annual revenues from the property, both present and future b. the value of the expected annual revenues from the property, both present and future, and the rate of inflation c. the opportunity cost of the property d. the present (this year only) revenue generated by the property e. the demand side only since the supply of the property is already fixed