The Base Period Used in Computing a Price Index Is

question 25

Multiple Choice

The base period used in computing a price index is

• A)The year in which prices were at their lowest level.
• B)The year in which prices were at their average level.
• C)A fixed reference year from which meaningful comparisons can be made.
• D)The earliest year for which data are available.

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Definitions:

Diminish

To decrease or make smaller in size, importance, or intensity.

Excludability

The characteristic displayed by those goods and services for which sellers are able to prevent nonbuyers from obtaining benefits.

Consuming

Consuming involves using up goods or services by purchasing, eating, or utilizing them to satisfy needs or wants.

Good

A material item or service that satisfies a need or desire and is available for purchase or trade.