Price indexes:
A) allow us to convert nominal measures of output into real measures of output.
B) help us measure the goods and services consumers can purchase with their money.
C) are used to measure the aggregate price level.
D) All of these statements are true.

Question

Quizplus · Accepted Answer

All three statements are true. Price indexes are used to measure the aggregate price level, which helps us measure the goods and services consumers can purchase with their money. Additionally, price indexes allow us to convert nominal measures of output into real measures of output by adjusting for inflation.

Price Indexes