In Which of the Following Cases Would There Be an Effect

question 189

Multiple Choice

In which of the following cases would there be an effect on the value of the U.S.consumer price index,but not on the value of the U.S.GDP deflator?

• A)All of the truck tires that are produced by a certain company in South Korea are sold to the U.S.military,and the price of these tires decreases.
• B)All of the truck tires that are produced by a certain company in California are sold to the U.S.military,and the price of these tires decreases.
• C)Most of the bananas that are produced by a certain company in Honduras end up in U.S.grocery stores,and the price of these bananas increases.
• D)Most of the earth-moving machines that are produced by a certain company in Illinois are exported to other countries,and the price of these machines increases.

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Definitions:

Purchased

The act of acquiring ownership of an asset in exchange for payment.

Digital Option

A type of option that pays either a fixed amount of cash or nothing at all, depending on whether a certain condition is met at expiration.

Jobless Claims

The number of unemployed individuals who are actively seeking employment and have filed for unemployment benefits.

Strike Price

The predetermined price at which the holder of an option can buy (in the case of a call option) or sell (in the case of a put option) the underlying security or commodity.