« previous next »

Author Question: What are the three stages of constructing the CPI? What will be an ideal ... (Read 72 times)

nevelica

  • Hero Member
  • *****
  • Posts: 563
on: Jun 29, 2018
What are the three stages of constructing the CPI?
 
  What will be an ideal response?

Question 2

Retirement savings accounts, such as IRAs, help increase economic growth because
 
  A) they encourage international trade.
  B) government invests them.
  C) they keep the interest rates high.
  D) people have an incentive to work harder and longer hours to save for the future.
  E) savings finances investment.


wuly

  • Sr. Member
  • ****
  • Posts: 327
Reply #1 on: Jun 29, 2018
Answer to Question 1

The first stage is to select the CPI market basket. The market basket is determined by surveying the spending habits of consumers by conducting a Consumer Expenditure Survey. The second stage is to check the prices of about 80,000 goods and services in 30 metropolitan areas. This checking is done on a monthly basis. The third stage is to calculate the CPI itself. To calculate the CPI, a period of time is selected as the base reference period and the cost of the CPI market basket using the prices from that period is computed. Then the CPI in any other month equals 100 times the quotient of the cost of the market basket using current-period prices divided by the cost of the market basket in the reference base period.

Answer to Question 2

E


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

The word drug comes from the Dutch word droog (meaning "dry"). For centuries, most drugs came from dried plants, hence the name.

Did you know?

After a vasectomy, it takes about 12 ejaculations to clear out sperm that were already beyond the blocked area.

Did you know?

As of mid-2016, 18.2 million people were receiving advanced retroviral therapy (ART) worldwide. This represents between 43–50% of the 34–39.8 million people living with HIV.

Did you know?

The liver is the only organ that has the ability to regenerate itself after certain types of damage. As much as 25% of the liver can be removed, and it will still regenerate back to its original shape and size. However, the liver cannot regenerate after severe damage caused by alcohol.

Did you know?

Eating carrots will improve your eyesight. Carrots are high in vitamin A (retinol), which is essential for good vision. It can also be found in milk, cheese, egg yolks, and liver.

Kohlberg's Stages of Moral Development Kohlberg's Stages of Moral Development
Types of fractures. Massage is contraindicated near fractures in early stages of healing. Types of fractures. Massage is contraindicated near fractures in early stages of healing.
What Anaphase Looks Like At Different Stages What Anaphase Looks Like At Different Stages
Stages of Oocyte Development Stages of Oocyte Development
Butterfly life cycle stages June 6 2023 Butterfly life cycle stages June 6 2023
Constructing a Three-Point Recombination Map Constructing a Three-Point Recombination Map
Video: Stroke volume

For a complete list of videos, visit our video library