Economists Use the Price Index to Eliminate Year-To-Year Changes in GDP

question 6

Multiple Choice

Economists use the price index to eliminate year-to-year changes in GDP due solely to changes in:

• A)the exchange rate.
• B)the unemployment rate.
• C)fiscal spending.
• D)consumer demand.
• E)the price level.

Apply concepts of percentage change to demographic and economic indicators.

Understand and apply concepts of speed and efficiency in work-related contexts.

Understand how to calculate the percentage by which revenue exceeds operating expenses given the percentage of operating expenses to revenue.

Comprehend the relationship between the numerator and denominator in a fraction and their impact on the fraction's value.

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Definitions:

Opportunity Cost

The expense incurred by not choosing the next most favorable option when a decision is made or one possibility is selected over another.

Transaction Costs

The time, effort, and other resources needed to search out, negotiate, and complete an exchange.

Price Ceiling

A legally established maximum price for goods or services, intended to protect consumers from excessively high prices.

Market Equilibrium

A condition in which market supply equals market demand, and the price of the good or service stabilizes.