Over a 10-Year Period, the Consumer Price Index Doubled

question 148

Multiple Choice

Over a 10-year period, the Consumer Price Index doubled.On the basis of this information and using the rule of 70, we can say that the average annual rate of inflation over this period was approximately

• A)10 percent.
• B)9 percent.
• C)7 percent.
• D)5 percent.

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Definitions:

Policy

A deliberate system of principles to guide decisions and achieve rational outcomes, often enacted by a governmental or corporate entity.

Short Run

A period in economics during which at least one input, such as factory capacity, is fixed and cannot be changed.

Unemployment Benefits

Payments made by the government or a social insurance scheme to unemployed individuals who meet certain eligibility criteria.

Aggregate Demand

The combined demand for goods and services across an economy, pegged at a particular overall price level during a predetermined time period.