Exam 8: The Price Level and Inflation

If a Hershey's chocolate bar cost $0.05 in 1921 when the price index was 18 and the same size and weight Hershey's chocolate bar cost $0.05 in 1955 when the price index was 27, then

It has been shown that increases in the money supply are directly related to the rate of inflation. If the previous statement is true, then

Your nominal wage increases by 10 percent, and the overall price level increases by 12 percent. Which statement is correct?

Typically the consumer price index CPI) is calculated by checking the prices of

Which statement best represents the purpose for measuring annual inflation or deflation)?

Refer to the following figure to answer the next questions: -Based on the figure, one could correctly state that

In some nations the only currency is gold. Someone proposes the argument that if gold were the only currency, there could not be inflation. Would you agree or disagree with this statement? Explain.

In the equation M * V= P * Y, the variable Y stands for

Consider the equation % $\Delta$ M + % $\Delta$ V $\approx$ % $\Delta$ P + % $\Delta$ Y. If there is no change in real GDP % $\Delta$ Y =0) and there is no change in the money supply % $\Delta$ M = 0), what would have to happen for there to be inflation % $\Delta$ P 0)?

In Bovania, milk constitutes 56 percent of the typical basket of goods for a typical consumer. Let's say the price of milk rises by 7 percent and the prices of all other goods fall by 4 percent. Based on the information given, we can definitely say

Inflation can create uncertainty by making

The ratio Price Level in Earlier Time) / Price Level Today) would be used to

According to the consumer price index CPI), in a particular year, the price of gasoline rises in the United States by 22 percent; simultaneously, the price of all food items falls by 8 percent. Which statement is correct?

If the goods producers buy change dramatically between years, then

According to the July 2015 consumer price index CPI), the top three consumer expenditure categories are, respectively,

It is rare when prices fall in modern times. However, it is likely that they would fall during severe recessions. In what year is this most likely to have occurred?

The chained consumer price index CPI) tends to be

A price confusion problem is best described as the

If the price of a typical market basket of goods increased from about $20 in 1960 to $200 in early 2012, then it

The website that provides official inflation statistics is