The Chain-Weighted Index for GDP and the CPI Differ in That

question 21

Multiple Choice

The chain-weighted index for GDP and the CPI differ in that the CPI

• A) excludes price changes from used and imported goods while the chain-weighted index includes these price changes.
• B) asks how much a fixed basket of goods costs in the current year as compared to the cost of those same goods in a base year while the chain-weighted index takes an average of price changes using base years from neighboring years.
• C) is calculated by the Commerce Department while the chain-weighted index is calculated by local newspapers.
• D) is calculated in nominal terms and the chain-weighted index is calculated in real terms.

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Definitions:

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts is a contra-asset account that reduces the total receivables on the balance sheet to reflect the amount that is not expected to be collected.

Accounts Receivable

Outstanding payments from customers to a firm for delivered or utilized goods or services pending payment.

Emotional Capital

The resources available within individuals or groups based on trust, empathy, and social connections that can be beneficial for personal or collective success.

Marital Rituals

Customs and practices associated with marriage ceremonies.