When the price of a good decreases more slowly than an index of average prices decreases,the good's relative price
A)Has risen while its actual price has fallen.
B)And its actual price has risen.
C)And its actual price has fallen.
D)Has fallen while its actual price has risen.

Question

Quizplus · Accepted Answer

If the price of a good decreases more slowly than an index of average prices, this means that the price of the good is actually falling, but not as quickly as the prices of other goods. This means that the good's relative price, or its price compared to other goods, has increased even though its actual price has fallen.

When the Price of a Good Decreases More Slowly Than