Use the Following Information to Answer This Question About the Country

question 2

Multiple Choice

Use the following information to answer this question about the country of Polity: $$\begin{array} { l c c c c } & 2000 & &{ 2001 } \\\hline \text { Good } & \text { Quantity } & \text { Price } & \text { Quantity } & \text { Price } \\\hline \text { Guns } & 4000 & \$ 4 & 4500 & \$ 6 \\\text { Butter } & 5000 & \$ 3 & 5200 & \$ 2 \\\hline\end{array}$$ Using a fixed-weight price index with 1998 as the base year, what is the percent change in real output from 2000 to 2001?

• A) 8%
• B) 10%
• C) 12%
• D) 15%

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Definitions:

Causality

The concept that an event (the cause) directly leads to another event (the effect) through a causal relationship.

Correlations

Statistical measures that denote the extent to which two or more variables fluctuate together.

Structural Equation Modeling

A multivariate statistical analysis technique that is used to analyze structural relationships between measured variables and latent constructs.

Confirmatory

Referring to analyses or studies aimed at confirming or validating a previously formed hypothesis or theory.