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In January 2004, the price of coffee was $0.74 per pound. By January 2011, the price of coffee had increased to $2.63. The simple index is about ______________.


A) 0.48
B) 0.28
C) 355
D) 189

E) B) and D)
F) A) and D)

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What is the purpose of an index?

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The purpose of an index is to ...

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Data for selected vegetables purchased at wholesale prices for 1995 and 2007 are shown next. Data for selected vegetables purchased at wholesale prices for 1995 and 2007 are shown next.   What is Fisher's ideal index? A)  107.5 B)  102.7 C)  112.8 D)  103.2 What is Fisher's ideal index?


A) 107.5
B) 102.7
C) 112.8
D) 103.2

E) A) and C)
F) C) and D)

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Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown next. Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown next.   What is Paasche's price index? A)  116.45 B)  116.71 C)  116.67 D)  131.56 What is Paasche's price index?


A) 116.45
B) 116.71
C) 116.67
D) 131.56

E) A) and D)
F) A) and C)

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Data for selected vegetables purchased at wholesale prices for 1995 and 2007 are shown next. Data for selected vegetables purchased at wholesale prices for 1995 and 2007 are shown next.   What is the value index? A)  110.3 B)  115.6 C)  108.0 D)  118.5 What is the value index?


A) 110.3
B) 115.6
C) 108.0
D) 118.5

E) A) and B)
F) None of the above

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One function of the CPI is to allow consumers to determine the degree to which their purchasing power is being eroded by price increases.

A) True
B) False

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An index number is a percent that measures the change from one period of time to another in terms of _________.


A) value
B) price
C) quantity
D) all of these

E) A) and B)
F) None of the above

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Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown next. Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown next.   What is the simple price relative for fuel oil? What is the simple price relative for fuel oil?

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114.39
Exp...

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Suppose your annual 2001 salary was $40,000 and your 2006 salary was $52,000. Assume the annual CPI rose from 177.1 to 202.9 during this period of time. In which year was your "real" income larger?

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2006
Explanation: Calculate fo...

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All indexes have the same base, namely 1982-84, written 1982-84 = 100.

A) True
B) False

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Cost-of-living adjustments are based on the _______________________.

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Consumer P...

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Which of the following statements is TRUE about price-weighted indexes? I. The Laspeyres index uses base-period quantities as weights. II) The Paasche index tends to underweight goods whose prices have gone down. III) The Paasche index uses current-period quantities as weights.


A) I only
B) II only
C) I and III
D) II and III

E) C) and D)
F) B) and D)

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The Dow Jones Industrial Index is a ____________________.

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special-pu...

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A company has data on annual revenue for ten years beginning in 1995. The company wants to compute an index using the revenues from 1995, 1996, and 1997 as the base. If the revenues for the three years were (in $millions) $1.5, $1.3, and $2.0, what is the base value?

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$1.6 million
Explanation: The ...

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Describe the process of collecting data for the CPI.

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The Consumer Price Index is based on abo...

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You are given the following information on selected food items: You are given the following information on selected food items:   The Laspeyres price index when the current period is 2013 and the base year is 2006 is ______________. A)  142.39 B)  135.63 C)  70.23 D)  73.73 The Laspeyres price index when the current period is 2013 and the base year is 2006 is ______________.


A) 142.39
B) 135.63
C) 70.23
D) 73.73

E) None of the above
F) A) and D)

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Suppose your annual 2001 salary was $40,000 and your 2006 salary was $52,000. Assume the annual CPI rose from 177.1 to 202.9 during this period of time. What was your real income in 2006?

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$25,628
Explanation: Calculate...

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The following data was collected comparing car prices and quantity sold (thousands). The following data was collected comparing car prices and quantity sold (thousands).   Compute value index to compare car prices in 2010 to 2000. Compute value index to compare car prices in 2010 to 2000.

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106.88
Explanation: Use formul...

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What does a typical market basket of goods and services include?


A) Bread
B) Beer
C) Milk
D) All of these

E) All of the above
F) B) and C)

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The wholesale price of a straight back desk chair in 2004 was $70; in 2005, $80.50; and in 2006, $63. What were the indexes for 2005 and 2006 using 2004 = 100?


A) 115.0 and 90.0
B) 1.15 and 0.9
C) 1150.0 and 900.0
D) 87.0 and 111.1

E) All of the above
F) B) and C)

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