Which of the Following Is a Reason Why the CPI

question 30

Multiple Choice

Which of the following is a reason why the CPI is not calculated as a simple average of all prices?

• A) Some goods experience large price changes and the CPI would be too variable if computed by a simple average.
• B) Goods differ in their importance in the average consumer's budget.
• C) Some goods never experience price changes and the CPI would not be variable enough if computed as a simple average.
• D) It would be difficult to compute a price index using a simple average of all prices.

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Definitions:

Promotional Mix

The promotional mix is the combination of marketing communication tools and strategies a company uses to promote its brand or products, including advertising, sales promotion, public relations, personal selling, and direct marketing.

Major Tools

Primary instruments or resources used to carry out a specific task or function.

Differentiates Product

The process or strategy of making a product stand out from its competitors in the market.

Publicity

An aspect of public relations consisting of any message about your company communicated through the mass media that you do not pay for.