The Chained Consumer Price Index (CPI) Is A/an

question 53

Multiple Choice

The chained consumer price index (CPI) is a/an:

• A) arithmetic average of the prices of all goods produced in gross domestic product (GDP).
• B) arithmetic average of the prices of all consumer goods produced in GDP.
• C) geometric average of the prices of the typical consumer market basket.
• D) geometric average of the prices of all goods produced in GDP.
• E) process of linking the prices of older goods that are no longer produced (such as cassette tapes and eight-track tapes) with "modern" goods (such as MP3 and MP4 players) in a process called chaining.

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Definitions:

Common Stock

A form of corporate equity ownership, representing a claim on a portion of a company’s profits and assets.

Par Value

Par value is the nominal or face value of a bond, stock, or other security, as stated by the issuing company in its charter.

Treasury Stock

Shares that were issued and subsequently reacquired by the issuer, not considered when calculating earnings per share or dividends.

Retained Earnings

The portion of net income left over for the business after it has paid out dividends to shareholders, often reinvested in the business.