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While the CPI focuses on changes to prices for consumers, the PPI measures the prices of goods and services purchased by firms

While the CPI focuses on changes to prices for consumers, the PPI measures the prices of goods and services purchased by firms

While the CPI focuses on changes to prices for consumers, the PPI:

A. measures the prices of goods and services purchased by firms.

B. stands for the producer price index.

C. looks specifically at the prices changes that affect the typical producer.

D. All of these statements are true.

52.The price index that measures the prices of goods and services purchased by firms is called the:

A. producer price index.

B. purchasing power index.

C. consumer price index.

D. retail sales index.

53.The price index that measures the prices of goods and services purchased by firms is called the:

A. PPI.

B. CPI.

C. RPI.

D. PRI.

54.A good that is most likely to be in the producer price index is:

A. industrial machinery.

B. light trucks.

C. soft lumber.

D. All of these are in the PPI.

55.A good that is most likely to be in the producer price index is:

A. light trucks.

B. gasoline.

C. passenger cars.

D. All of these are in the PPI.

56.A good that is most likely to be in the producer price index is:

A. gasoline.

B. apples.

C. books.

D. All of these are in the PPI.

57.Because increases in input prices eventually make it to consumers when they buy the final product, the PPI:

A. is considered a good predictor of future consumer prices.

B. is a lag variable for inflation.

C. accounts for inflation before it reaches consumers, adjusting the CPI downward.

D. accounts for inflation before it reaches consumers, adjusting the CPI upward.

58.The producer price index is considered a good predictor of future consumer prices because:

A. increases in input prices eventually make it to consumers when they buy the final product.

B. increases in input prices are accounted for in PPI, and therefore this automatically adjusts the CPI.

C. increases in input prices are observed first in the PPI, adjusting the CPI downward.

D. None of these statements is true.

59.Regardless of the index we use:

A. inflation is measured as a percent increase in the index from one year to the next.

B. we get the same measurements for inflation, so each is equally useful.

C. the measurement of inflation is the same, so we use the one easiest to calculate.

D. All of these statements are true.

60.Inflation is measured by examining the percent increase in the ________ from one year to the next.

A. CPI

B. PPI

C. GDP deflator

D. Inflation is measured as the percentage increase of any index, regardless of the index used.

abhinav behal 15-Feb-2020

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