All of the following cause the CPI to measure more inflation than there really is, EXCEPT:
A. substitution bias
B. introduction of new goods
C. unmeasured quality change
D. the steady increase in the number of consumers
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Suppose the price of fish increases, so households now buy less fish and more chicken. This will cause the:
A. CPI to measure more inflation than there really is
B. CPI to measure less inflation than there really is.
C. PPI to measure less inflation than there really is
D. GDP deflator to measure less inflation than there really is
Which of the following statements is true？
A. The GDP deflator considers only a basket of goods, while the CPI considers everything produced
B. The GDP deflator includes imports, while the CPI does not
C. The GDP deflator uses a fixed bundle of goods, while the CPI uses a changing bundle of goods
D. The GDP deflator measures the inflation of everything produced in the nation, while the CPI measures the inflation of the goods typically bought by households
If John earned $30,000 in 1990, how much would that be worth in today's dollars? Suppose the CPI was 160 in 1990 and is 220 today.
A. $21,810
B. $50,000
C. $41,250
D. $11,250
Suppose today’s CPI is 134.85, and today one must spend $580 to purchase the same basket of goods and services that could be bought for $400 in 1989. Then the CPI in 1989 was
A. 68.97.
B. 89.00.
C. 93.00.
D. 101.85.
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