The price of a good that prevails in a world market is called the

When people use all the relevant data and principles of economics to forecast inflation, they are making

A) what is called a "data-based forecast." B) an always accurate forecast. C) a mistake. D) what is called a "rational expectation." E) an exaggerated forecast.

The consumer price index (CPI)

A) compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2. B) compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period. C) measures the increase in the prices of the goods included in GDP. D) is the ratio of the average price of a typical basket of goods to the cost of producing those goods.