A price index
A. is the ratio of the price of a market basket in one year to the price of the market basket in the previous year times 100.
B. is a mechanism to compare all prices in two different years.
C. is a mechanism to compare all prices in two different years and the ratio of the price of a market basket in one year to the price of the market basket in the previous year times 100.
D. is the ratio of the price of a market basket in one year to the price of the market basket in a base year times 100.
Answer: C
You might also like to view...
Which of the following is an example of a natural experiment?
A) A research on the effectiveness of a new medicine among some voluntary participants B) A study on the benefits of regular exercise by paying for the membership fees at fitness clubs for one-half of the participants C) A laboratory research on the effectiveness of solar power as an alternative source of fuel D) A research on the effect of air pollution on lung disorders by observing the health conditions of people who stay close to industrial areas and those who stay away from industries
Suppose firms in a perfectly competitive industry are making economic profits. As a result I. new firms enter the industry. II. the market price falls. III. the economic profits of the existing firms decrease
A) I, II and III B) I and II C) II and III D) I and III