in the base year, the price index will always have a value of zero. a. false b. true the ______ is a price…

in the base year, the price index will always have a value of zero. a. false b. true the ______ is a price index measuring the changes in prices of all new goods and services produced in the economy. a. gdp deflator b. producer price index (ppi) c. personal consumption expenditure (pci) index d. consumer price index (cpi)

in the base year, the price index will always have a value of zero. a. false b. true the ______ is a price index measuring the changes in prices of all new goods and services produced in the economy. a. gdp deflator b. producer price index (ppi) c. personal consumption expenditure (pci) index d. consumer price index (cpi)

Answer

Brief Explanations:

  1. In the base - year, the price index is set to 100 (not 0) to serve as a reference point for measuring price changes over time. So the first statement is false.
  2. The GDP deflator measures the changes in prices of all new goods and services produced in the economy. The Producer Price Index (PPI) measures average changes in selling prices received by domestic producers; the Personal Consumption Expenditure (PCE) Index measures changes in the prices of goods and services purchased by consumers; the Consumer Price Index (CPI) measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Answer:

  1. A. False
  2. A. GDP deflator