In Nation A,the Price Index Rises from 110 to 120

question 82

Multiple Choice

In Nation A,the price index rises from 110 to 120 in a particular year.In the same year,the price level rises from 120 to 130 in Nation B.This means:

• A) inflation in both nations is 10%.
• B) Nation B suffers from hyperinflation.
• C) both nations suffer from hyperinflation.
• D) Nation A is experiencing inflation but Nation B is experiencing deflation.
• E) Nation A is experiencing inflation of less than 9.3% and Nation B is experiencing inflation of less than 8.5%.

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Definitions:

Recency Effect

The psychological phenomenon where the most recently presented information is remembered better than information presented earlier.

Eyewitness Memory

The recollection by individuals of events they have witnessed, significant in the context of legal trials and psychology due to its reliability and susceptibility to error.

Short-Term Memory

The capacity for holding, but not manipulating, a small amount of information in mind in an active, readily available state for a short period of time.

Declarative Memory

The aspect of human memory that involves the capacity to recall factual information, such as events, facts, and concepts.