Table 20-4 -Refer to Table 20-4.Suppose an Economy Has Only Three Goods

question 118

Multiple Choice

Table 20-4

-Refer to Table 20-4.Suppose an economy has only three goods and the typical family purchases the amounts given in the table above.If 2006 is the base year,then what is the CPI for 2011?

• A) 14.3
• B) 87.5
• C) 114.3
• D) 160

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Definitions:

Equilibrium Price

The price at which the quantity of goods supplied matches the quantity of goods demanded in a market, leading to a stable market condition.

Quantity Demanded

The total amount of a good or service that consumers are willing to purchase at a given price level in a specified period.

Quantity Supplied

The level of a commodity or service that manufacturers are eager and capable of providing for purchase at a determined price over an established period.

Rollerblades

Inline skates used for recreation or sport, featuring a single line of wheels attached to the bottom of a boot.