Table 16-6

question 198

Multiple Choice

Table 16-6.The table below applies to an economy with only two goods - hamburgers and hot dogs.The fixed basket consists of 4 hamburgers and 8 hot dogs.

-Refer to Table 16-6.If the base year is 2010,then the consumer price index is

• A) 100 in 2009,109 in 2010,and 115 in 2011.
• B) 95.90 in 2009,100 in 2010,and 107.44 in 2011.
• C) 90.91 in 2009,100 in 2010,and 106.36 in 2011.
• D) 88.82 in 2009,100 in 2010,and 107.44 in 2011.

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Definitions:

Unemployment

Unemployment refers to the situation when individuals who are capable of working and are actively seeking work are unable to find employment.

Inflation

A broad upsurge in pricing with a corresponding fall in the worth of money.

Short-run Phillips Curve

A graphical representation showing the inverse relationship between unemployment and inflation rates in the short term.

Inflation Expectations

Inflation expectations are the rate at which people—consumers and investors—expect the general level of prices to change in the future.