An Important Difference Between the GDP Deflator and the Consumer

question 112

Multiple Choice

An important difference between the GDP deflator and the consumer price index is that

• A) the GDP deflator reflects the prices of goods and services bought by producers, whereas the consumer price index reflects the prices of goods and services bought by consumers.
• B) the GDP deflator reflects the prices of all final goods and services produced domestically, whereas the consumer price index reflects the prices of some goods and services bought by consumers.
• C) the GDP deflator reflects the prices of all final goods and services produced by a nation's citizens, whereas the consumer price index reflects the prices of final goods and services bought by consumers.
• D) the GDP deflator reflects the prices of all goods and services bought by producers and consumers, whereas the consumer price index reflects the prices of final goods and services bought by consumers.

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Definitions:

Bundling

The practice of selling multiple products or services together as a combined package, often at a discounted price.

Cross-selling

The strategy of selling additional products or services to an existing customer based on their previous purchases.

Downselling

A sales strategy where a seller offers a more affordable or lesser alternative to a product the customer initially showed interest in.

Upselling

A sales technique where a seller induces the customer to purchase more expensive items or add-ons for an upgrade.