The "basket" on which the CPI is based is composed of ?
Correct answer: B. Products purchased by the typical consumer
- A. consumer production
- B. Products purchased by the typical consumer
- C. raw materials purchased by firms
- D. total current production
- E. none of these answers
Explanation
The CPI tracks the cost of a fixed basket representing goods and services bought by a typical consumer. It is not based on firms’ raw materials or total current production.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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