When Prices of Different Goods Are Increasing by Different Amounts

question 63

Multiple Choice

When prices of different goods are increasing by different amounts, the price index that will rise the fastest is:

• A) Fisher's ideal index.
• B) the CPI.
• C) the GDP deflator.
• D) a Paasche index.

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Definitions:

Radius

The length measured from a circle's midpoint to any location along its outer edge.

Center

The middle point of a shape, object, or group of points, often equidistant from all outer edges or surfaces.

Radius

The distance from the center to the circumference of a circle or sphere.

Parabola

A symmetrical, open curve that represents the graph of a quadratic function, defined as the set of all points equidistant from a point called the focus and a fixed line called the directrix.