TABLE 16-2 Given Below Are the Prices of a Basket of Four

question 128

Short Answer

TABLE 16-2
Given below are the prices of a basket of four food items from 2006 to 2010.

-Referring to Table 16-2, what is the unweighted aggregate price index for the basket of four food items in 2009 using 2006 as the base year?

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Definitions:

Implicit Costs

Non-out-of-pocket costs, often opportunity costs, that represent the lost opportunity to use resources in an alternative way.

Short Run

The period of time during which at least one input, such as plant size, is fixed and cannot be changed.

Long Run

A period in economics where all factors of production and costs are variable, allowing companies to adjust all inputs and operations to market demands.

Fixed Resource

A resource or asset in production whose quantity cannot easily be increased or decreased in the short term.