If the Price Index for a Particular Year Is 110

question 21

Multiple Choice

If the price index for a particular year is 110, it implies that ________.

• A) prices have increased by 11% over the base year
• B) prices have increased by 10% over the base year
• C) prices have increased by 1.1% over the base year
• D) prices have increased by 0.10% over the base year

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Definitions:

Stock Exchange

A marketplace where stocks and other securities are bought and sold, facilitating the transfer of securities among investors.

Initial Public Offering

The first sale of stock by a private company to the public, typically used to raise capital for expansion.

Common Shareholder

A common shareholder is an individual or entity that holds common stock in a corporation, granting them voting rights and a share in the company's profits through dividends.

Declare Dividends

The action by a company's board of directors to distribute a portion of the company’s earnings to its shareholders.