Suppose Total Expenditures for a Typical Household in 2009 Were

question 90

Multiple Choice

Suppose total expenditures for a typical household in 2009 were $2,500 per month and that the cost of purchasing exactly the same items in 2012 was $3,200 per month.If 2009 is the base year,the consumer price index (CPI) for 2012 equals

• A) 78.
• B) 100.
• C) 128.
• D) 131.
• E) 145.

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Definitions:

Tax

A compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization.

Consumer Surplus

The imbalance between the total budget consumers are willing to allocate for a product or service and the actual spending.

Consumer Surplus

The separation between the ideal amount consumers are willing to spend on a service or product and their real expenditures.

Producer Surplus

The discrepancy between what producers are ready to take for a product or service and the real amount they get.