Price Indexes Like the CPI Are Calculated Using a Base

question 29

Multiple Choice

Price indexes like the CPI are calculated using a base year. The term base year refers to:

• A) the first year that price data are available.
• B) any year in which inflation was higher than 5 percent.
• C) the most recent year in which the business cycle hit the trough.
• D) an arbitrarily chosen reference year.

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Definitions:

Cohesion

The ability of water molecules to cling to each other due to the process of hydrogen bonding.

Negative Pressure Potential

A force that contributes to the movement of water in plants, created by the evaporation of water from the stomata, resulting in a suction effect.

Venation

The pattern of veins in a leaf or insect's wing, which support the structure and transport fluids, like nutrients and water.

Identification

The process of recognizing or establishing the identity of a person or thing, often through specific characteristics or markers.