If the Consumer Price Index Falls from 120 to 116

question 201

Multiple Choice

If the consumer price index falls from 120 to 116 in a particular year, the economy has experienced

• A)inflation of 4 percent.
• B)inflation of 3.33 percent.
• C)deflation of 3.33 percent.
• D)deflation of 4 percent.

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Definitions:

Reservation Price

The utmost price a buyer is ready to offer for a good or service.

Expected Revenue

The amount of money a business anticipates receiving from its goods or services over a certain period.

English Auction

A method of sale involving ascending bids, where the item is sold to the highest bidder.

Expected Revenue

The anticipated total income of a business from the sale of goods or services, based on probable outcomes.