Suppose the CPI does indeed overstate the inflation rate. When the CPI increases by 5% and household incomes increase by 5%, we should conclude that real incomes of households have:

A. increased more slowly than has inflation.
B. increased.
C. decreased.
D. stayed constant.

Answer: B

Economics

You might also like to view...

If total revenue falls when output increases, marginal revenue is

A) positive. B) negative. C) zero. D) greater than total revenue. E) elastic.

View
Economics

Keynes rhymes with

A) beans. B) gains. C) genies. D) none of the above.

View
Economics