Table 6-6 the Table Below Applies to an Economy with Only

question 406

Multiple Choice

Table 6-6. The table below applies to an economy with only two goods - hamburgers and hot dogs. The fixed basket consists of 4 hamburgers and 8 hot dogs.

-Refer to Table 6-6. If the base year is 2009, then the economy's inflation rate is

• A) 10 percent in 2010 and 6.36 percent in 2011.
• B) 10 percent in 2010 and 17 percent in 2011.
• C) 9.2 percent in 2010 and 6 percent in 2011.
• D) 8.22 percent in 2010 and 5 percent in 2011.

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Definitions:

Net Worth

The difference between an individual or household’s assets and liabilities.

Revenue Bond

A type of bond issued by municipalities or government entities, backed by specific revenue sources rather than the issuer's full faith and credit.

Preferred Stock

Shares that give owners limited voting rights, and the right to receive dividends or assets before owners of common stock.

Convertible Securities

Bonds or preferred stock issues that are convertible into a set number of shares of the issuing company’s common stock.