If a Hershey's Chocolate Bar Cost $0

question 113

Multiple Choice

If a Hershey's chocolate bar cost $0.05 in 1921 when the price index was 18 and the same size and weight Hershey's chocolate bar cost $0.05 in 1955 when the price index was 27,then

• A) the inflation-adjusted price of the bar would be lower in 1955 than in 1921.
• B) the inflation-adjusted price of the bar would be higher in 1955 than in 1921.
• C) Hershey's mispriced the bar due to a price confusion problem.
• D) the United States must have experienced deflation during the period from 1921-1955.
• E) menu costs for Hershey's were high.

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Definitions:

Shift Right

In economics, a term used to describe the movement of a supply or demand curve to the right, indicating an increase in supply or demand.

Decreases in Value

A reduction in the worth or price of an asset or commodity.

Foreign Currencies

Money or other forms of legal tender issued by countries other than one's own, used in international trade and finance transactions.

U.S. Exports

Goods and services produced in the United States and sold to other countries, contributing to the national economy.