The Consumer Price Index Measures

question 349

Multiple Choice

The Consumer Price Index measures

• A) the average of raw material prices paid by producing firms.
• B) the level of prices with respect to goods and services purchased by a typical consumer in urban areas.
• C) the average of the prices of all goods produced in a country and goods imported from other countries.
• D) hourly wage rates of manufacturing workers.

---

Definitions:

Preconceptions

Preformed opinions or beliefs, often without basis in fact or experience, that influence one's perception.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to mind when evaluating a specific topic, concept, method, or decision.

Overconfidence

A cognitive bias where an individual's subjective confidence in their own abilities is greater than their objective accuracy.

Representativeness Heuristic

A mental shortcut that involves making a decision based on how closely a new situation or object resembles a prototype or typical case.