Between October 2001 and October 2002, the CPI in Canada

question 180

Multiple Choice

Between October 2001 and October 2002, the CPI in Canada rose from 116.5 to 119.8 and the CPI in Mexico rose from 93.2 to 102.3. What were the inflation rates for Canada and Mexico over this one-year period?

• A)2.8 percent for Canada and 9.1 percent for Mexico
• B)2.8 percent for Canada and 9.8 percent for Mexico
• C)3.3 percent for Canada and 9.1 percent for Mexico
• D)3.3 percent for Canada and 9.8 percent for Mexico

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Definitions:

Marginal Cost

The extra expense associated with the creation of an additional unit of a product or service.

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable, leading to a mismatch in supply and demand.

Demand Curve

A chart that displays the connection between a product's price and the amount of the product buyers are prepared and able to buy at different price levels.

Marginal Cost Curve

A graphical representation showing how the cost of producing one additional unit of a good changes as the production volume changes.