Suppose the CPI increased by 5 percent over each of the last 5 years while the GDP price index increased by 12 percent annually. Which of the following reasons could explain this difference? a. The price of investment goods purchased by businesses increased substantially relative to the prices of all other goods. b. The price of fighter planes dropped due to increased competition in the aerospace industry. c. The price of used goods increased substantially relative to the prices of other goods. d. Import good prices increased relative to domestic good prices.
Suppose the CPI increased by 5 percent over each of the last 5 years while the GDP price index increased by 12 percent annually. Which of the following reasons could explain this difference? a. The price of investment goods purchased by businesses increased substantially relative to the prices of all other goods. b. The price of fighter planes dropped due to increased competition in the aerospace industry. c. The price of used goods increased substantially relative to the prices of other goods. d. Import good prices increased relative to domestic good prices.
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter5: Measuring A Nation's Income
Section: Chapter Questions
Problem 5PA
Related questions
Question
Suppose the
a. |
The price of investment goods purchased by businesses increased substantially relative to the prices of all other goods. |
|
b. |
The price of fighter planes dropped due to increased competition in the aerospace industry. |
|
c. |
The price of used goods increased substantially relative to the prices of other goods. |
|
d. |
Import good prices increased relative to domestic good prices. |
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc