If the CPI Was 101

question 98

Multiple Choice

If the CPI was 101.7 in 2006 and 101.5 in 2007,it can be concluded that

• A) 2001 was the base year
• B) all goods were more expensive in 2007 than in 2006
• C) all goods were less expensive in 2007 than in 2006
• D) all goods were less expensive in 2006 than in 2007
• E) the price level fell from 2006 to 2007

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Definitions:

Oversubscription Privilege

is a right or privilege granted to existing shareholders to purchase additional shares in a new issue before it is offered to the public, especially in cases where the demand exceeds the supply.

Rights Offering

A method by which a company raises capital by giving existing shareholders the right to buy additional shares at a discount to the market price before offering them to the public.

General Cash Offer

A public offering of securities to all investors by a company, which involves selling securities directly to the general public to raise capital.

Underpriced

Refers to a situation where an asset is selling for less than its perceived or actual value.