Economists measure the price level with a(n)________,which is a measure of the average of the prices of goods and services in one year relative to a base year.
A) inflation index
B) chain-weighted index
C) deflation index
D) price index

Question

Quizplus · Accepted Answer

A price index is a measure of the average of the prices of goods and services in one year relative to a base year. It is used to track changes in the general price level over time. Other options are not correct. For example, an inflation index is a measure of the rate of change in prices over time, rather than the actual price level. A chain-weighted index is a method of calculating a price index that takes into account changes in relative prices over time. A deflation index is not a commonly used term in economics.

Economists Measure the Price Level with A(n)________,which Is a Measure