If the Consumer Price Index was 102.2 in 2007 and 104.9 in 2008,we can conclude that
A) the prices of all consumer goods were higher in 2008 than in 2007
B) the prices of all consumer goods were lower in 2008 than in 2007
C) the price level fell from 2007 to 2008
D) the price level rose from 2007 to 2008
E) the base year was 2001

Question

Quizplus · Accepted Answer

The Consumer Price Index measures the average price level of a basket of goods and services consumed by households. The increase in the index value from 102.2 to 104.9 indicates that, on average, the prices of the goods and services in the basket increased over the period. Therefore, the correct answer is that the price level rose from 2007 to 2008, which is option D. Options A and B are incorrect because they assume that all prices moved in the same direction, which is unlikely to happen. Option C, the price level fell from 2007 to 2008, is not consistent with the increase in the Consumer Price Index. Option E is unrelated to the question.

If the Consumer Price Index Was 102