1. The Consumer Price Index (CPI) measures the changes of the prices paid by all businesses for...
Question:
1. The Consumer Price Index (CPI) measures the changes of the
prices paid by all businesses for a fixed market basket of production resources. | ||
prices paid by consumers for a fixed market basket of consumer goods and services. | ||
quantities of a fixed market basket of goods produced by businesses. | ||
prices paid by consumers and businesses for a fixed market basket of goods and services. |
QUESTION 2
Market Basket | 1990 (Base Year) | 2010 | 2011 | |
Product | Quantity | Price | Price | Price |
A | 7 | $3 | $5 | $6 |
B | 11 | $5 | $8 | $8 |
C | 20 | $6 | $8 | $9 |
D | 15 | $9 | $13 | $12 |
2. If your answer is not a whole number, round to two decimal places.
3. What is the cost of the market basket in 1990? $
4. What is the cost of the market basket in 2010? $
5. What is the cost of the market basket in 2011? $
6. What is CPI in 1990?
7. What is CPI in 2010?
8. What is CPI in 2011?
9. What was the inflation rate in 2011? %
QUESTION 3
1. The CPI is biased because it
does not include services. | ||
takes into account the changes in product quality. | ||
does not always take into account the changes in product quality. | ||
takes into account the changes in technology. |
Mathematical Applications for the Management Life and Social Sciences
ISBN: 978-1305108042
11th edition
Authors: Ronald J. Harshbarger, James J. Reynolds