Question

The Consumer Price Index measures the average of the prices of all goods produced in a country and goods imported from other countries. the level of prices with respect to goods and services purchased by a typical consumer in urban areas. the average of raw material prices paid by producing firms. hourly wage rates of manufacturing workers..

Answer 1

Answer:

None of the answers is correct:

• the CPI measures only a basket of goods and services, not all the goods and services
• the CPI measures around the whole country, not only in urban areas
• raw materials or wage rates have nothing to do with the CPI

Explanation:

The Consumer Price Index (CPI) measures the weighted average prices of a basket of goods and services (called the CPI basket). It is calculated by determining how much the nominal prices of the CPI basket changes from one year to another, or how the prices have changed using a base year and their current prices.