The CPI in 2005 Was 113

question 110

True/False

The CPI in 2005 was 113.5 and in 2012 was 125.6 if compared to the base year of 2000, the purchasing power of the Dollar in 2012 was 88.11% of 2000.

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Definitions:

Real GDP

Gross Domestic Product adjusted for inflation, representing the value of all goods and services produced over a specific time period at constant prices.

Depreciation

The gradual reduction in the economic value of the physical assets of a company due to wear and tear over time, or the loss in value of a currency.

NDP

Net Domestic Product; it calculates the total value of all goods and services produced within a country in a specific period minus depreciation.

Intermediate Product

Goods that are used in the production process to make other goods, rather than being bought by consumers.