The consumer price index (CPI):
a. adjusts for changes in product quality.
b. includes separate market baskets of goods and services for both base and current years.
c. includes only goods and services bought by typical urban consumer.
d. uses current year quantities of goods and services.
c
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In the above figure, the shift in the demand curve from D to D1 can be the result of
A) a decrease in income if pizza is a normal good. B) a decrease in the price of a sub sandwich, a substitute for pizza. C) an increase in the price of soda, a complement to pizza. D) an increase in the number of teenagers, all of whom demand more pizza than do other age groups. E) new technology that increases the profit from producing pizza.
The above figure shows the market for a prescription drug. What is the equilibrium price of the drug? How many doses are purchased? Suppose the government imposes a price ceiling of $1.50 a dose
How many doses are purchased after the price ceiling is imposed?