Related to the Economics in Practice on P

question 172

Multiple Choice

Related to the Economics in Practice on p. 133: If a retiree's pension is tied to the CPI, her monthly pension check would tend to grow ________ if the pension is tied to the ________ CPI.

• A) slower; fixed-weight
• B) faster; chain-linked
• C) faster; fixed-weight
• D) The check would grow at the same rate regardless of the type of CPI to which it is tied.

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Definitions:

Inelastic

A characteristic of demand or supply where the quantity demanded or supplied changes by a smaller percentage than changes in the price.

Exhaustive Governmental Outlay

Government spending that directly utilizes resources for providing goods and services, distinct from transfer payments like subsidies and social benefits.

Subsidy Check

Financial assistance given by the government to individuals, businesses, or institutions to support or promote economic activities.

Temporary Assistance

Aid or support provided for a limited period, often aimed at individuals or families in financial need.