In the Basket of Goods That Is Used to Compute

question 119

Multiple Choice

In the basket of goods that is used to compute the consumer price index,the three largest categories of consumer spending are

• A)housing,transportation,and recreation.
• B)housing,transportation,and food & beverages.
• C)housing,food & beverages,and education & communication.
• D)housing,medical care,and education & communication.

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Definitions:

Profit-maximizing Output

The level of production at which a company achieves the highest possible profit.

Marginal Cost

The rise in overall expenses resulting from the production of an additional unit.

Marginal Revenue

The additional income from selling one more unit of a good; it is the change in total revenue from an additional unit sold.

Competitive Price-searcher

A market participant that actively seeks out and compares prices in order to find and exploit competitive price advantages.