Question

If the CPI is currently​ 202, what does this tell you about inflation between last year and this​ year? A. The CPI measures only the level of prices in a given​ year, not the percentage change in prices from one year to the next. B. There was deflation in the economy between this year and last year. C. Inflation in the economy between this year and last year was​ 2%. D. Inflation in the economy between this year and last year was​ 102%.

Answer 1

Answer: Option A

Explanation:

The CPI measures only the level of prices in a given​ year, not the percentage change in prices from one year to the next.

CPI means consumer price index it is used to measures changes in the price level of a weighted average market basket of consumer product usually goods and services purchased by households. The CPI is a statistical estimate that is constructed using the prices of a sample of items whose prices are collected periodically, it measures the changes but doesn’t express as a percentage.