The consumer price index and the GDP deflator are two alternative measures of the overall price level. Which of the following statements about the two measures is correct?
a. The two measures are constructed differently, but they always indicate the same inflation rate.
b. The substitution bias applies equally to both measures.
c. A change in the price of Korean televisions is reflected in the U.S. consumer price index but not in the U.S. GDP deflator.
d. All of the above are correct.
c
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Long lines and discrimination are examples of rationing methods that may naturally develop in response to a binding price ceiling
a. True b. False Indicate whether the statement is true or false
Which of the following statements is correct?
A. An increase in the price of C will decrease the demand for complementary product D. B. A decrease in income will decrease the demand for an inferior good. C. An increase in income will reduce the demand for a normal good. D. A decline in the price of X will increase the demand for substitute product Y.