What Does It Mean to Say That the Inflation Rate

Multiple Choice

What does it mean to say that the inflation rate last year was 5%?

A) All prices are 5% less at the end of the year than they were at the beginning of the year.
B) The price of specific products increased 5% between the beginning and the end of the year.
C) On average, a typical basket of goods costs 5% more at the end of the year than it did at the beginning of the year.
D) The general purchasing power of the dollar has increased 5% between the beginning of the year and the end of the year.