In Computing the Consumer Price Index, a Base Year Is

question 36

Multiple Choice

In computing the consumer price index, a base year is chosen. Which of the following statements about the base year is correct?

• A) The base year is always the first year among the years for which computations are being made.
• B) It is necessary to designate a base year only in the simplest case of two goods; in more realistic cases, it is not necessary to designate a base year.
• C) The value of the consumer price index is always 100 in the base year.
• D) All of the above are correct.

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Definitions:

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The acquisition of physical assets like machinery or technology used in the production of goods or services.

Accounts Receivable Subsidiary Ledger

A detailed ledger that tracks individual customer transactions and balances, complementing the overall accounts receivable account.

Record Sale

To record a sale refers to the process of documenting a sales transaction in the accounting books, acknowledging the exchange of goods or services for payment.

Revenue Journal

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