Suppose that people consume only three goods, as shown in this table: 2020 Price Quantity 2021 Price Quantity Percentage Change Tennis Balls True False $2 200 $3 200 True Golf Balls Bottles of Gatorade Complete the following table by computing the percentage change in price for each of the three goods. Tennis Balls Golf Balls Bottles of Gatorade False $5 80 $5 80 Using a method similar to that used to calculate the consumer price index, the percentage change in the overall price level is $2 100 % True or False: If you were to learn that a bottle of Gatorade increased in size from 2020 to 2021, that information would lower your estimation of the inflation rate. $4 100 True or False: If you were to learn that Gatorade introduced new flavors in 2021, that would imply that the inflation rate you estimated is understated.
Suppose that people consume only three goods, as shown in this table: 2020 Price Quantity 2021 Price Quantity Percentage Change Tennis Balls True False $2 200 $3 200 True Golf Balls Bottles of Gatorade Complete the following table by computing the percentage change in price for each of the three goods. Tennis Balls Golf Balls Bottles of Gatorade False $5 80 $5 80 Using a method similar to that used to calculate the consumer price index, the percentage change in the overall price level is $2 100 % True or False: If you were to learn that a bottle of Gatorade increased in size from 2020 to 2021, that information would lower your estimation of the inflation rate. $4 100 True or False: If you were to learn that Gatorade introduced new flavors in 2021, that would imply that the inflation rate you estimated is understated.
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter6: Consumer Choice And Demand
Section: Chapter Questions
Problem 2QFR
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