i. The concept of real income is sometimes called deflated income or income expressed in constant dollars and the CPI is called the deflator.
ii. To deflate sales, the actual sales are multiplied by the wholesale price index and the result multiplied by 100.
Iii) The CPI serves only one major function: as an economic indicator of the rate of inflation.
A) (i) is a correct statement, but (ii) and (iii) are incorrect statements
B) (i) and (ii) are correct statements, but not (iii).
C) (i) and (iii) are correct statements but not (ii).
D) (ii) and (iii) are correct statements but not (i).
E) All statements are false

Question

i. The concept of real income is sometimes called deflated income or income expressed in constant dollars and the CPI is called the deflator. 
ii. To deflate sales, the actual sales are multiplied by the wholesale price index and the result multiplied by 100.
Iii) The CPI serves only one major function: as an economic indicator of the rate of inflation.
A) (i) is a correct statement, but (ii) and (iii) are incorrect statements
B) (i) and (ii) are correct statements, but not (iii).
C) (i) and (iii) are correct statements but not (ii).
D) (ii) and (iii) are correct statements but not (i).
E) All statements are false

Quizplus · Accepted Answer

(i) is a correct statement because the concept of real income is sometimes called deflated income or income expressed in constant dollars and the CPI is called the deflator. (ii) is an incorrect statement because to deflate sales, the actual sales are divided by the wholesale price index and the result multiplied by 100. (iii) is an incorrect statement because the CPI serves several major functions, including as an economic indicator of the rate of inflation, as a deflator of other economic data, and as a basis for indexing various payments.

I the Concept of Real Income Is Sometimes Called Deflated