Attempts: Average: 12 2. Alternative price indexes Because there isn\'t one sing

Question

Attempts: Average: 12 2. Alternative price indexes Because there isn't one single measure of inflation, the government and researchers use a variety of methods to get the most balanced picture of how prices fluctuate in the economy. Two of the most commonly used price indexes are the consumer price index (CPI) and the GDP deflator. The GDP deflator for this year is calculated by dividing the using by the w using and multiplying by 100. However, the CPI reflects only the prices of all goods and services Indicate whether each scenario will ffect the GDP deflator or the CPI for the United States. Check all at apply Shows up in the... GDP Deflator CPI Scenario An increase in the price of a Waterman Industries deep-water reel, which is a commercial fishing product used for deep-sea fishing, made in the U.S., but not bought by U.S.consumers A decrease in the price of a Japanese-made phone that is popular among U.S. consumers

Explanation / Answer

(1) GDP Deflator is calculated by dividing the value of current year quantity of goods and services produced using Current year prices by the value of current year quantity of goods and services produced using Base year prices and multiplying by 100.

(2) CPI reflects only the price of all goods and services consumed by the typical household.

(3)

(a) Increase in price of Waterman reel - GDP Deflator

(b) Decrease in price of Japanese-made phone - CPI

NOTE: You can provide drop-down options in Comment section, for exact wording.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.