In the calculation of the CPI, tea is given greater weight than beer if O a….
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Question “In the calculation of the CPI, tea is given greater weight than beer if O a….”
Answer
Answer:
Qn.01) Option b. Consumers buy more tea than
beer.
Explanation: The consumer price index measures the total cost of goods and services a consumer consumes. It is calculated by adding up the price changes for each item in a precalculated basket and then dividing them. When a good is first purchased, its value is 100. It can increase or decrease depending on the price of the good each year. Tea is more expensive than beer, so consumers will buy more tea.
Qn.02) Option a.
True.
Explanation: Production Possibility Frontier determines the maximum combinations of outputs of two goods and services where all resources are used. The opportunity cost is the reallocation of scarce resources to produce another resource.
Conclusion
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