A New IPod with 30 New Features Costs $100 More

question 55

Multiple Choice

A new iPod with 30 new features costs $100 more to produce and buy than does the previous version.The $100 price increase

• A) is added to the inflation rate.
• B) is not added to the inflation rate because consumer electronics are not part of the inflation rate.
• C) is not added to the inflation rate because it represents an improvement in quality.
• D) is divided by the additional benefits and then added to the inflation rate.

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Definitions:

Securities Acts

Collectively refers to federal laws, such as the Securities Act of 1933 and the Securities Exchange Act of 1934, regulating the securities industry in the U.S.

Documentary Letter of Credit

A bank's promise to pay the seller on behalf of the buyer upon receipt of specified documents, typically used in international trade.

Seller's Risk

The risk borne by the seller of goods until the ownership is transferred to the buyer, typically under specified delivery terms.

Exported Goods

Items that are sent from one country to another for the purpose of trade or sale.