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A Current Value for the CPI of 125 Means That

Question 84

Multiple Choice

A current value for the CPI of 125 means that the


A) consumer must now pay $1.25 to purchase goods that cost $1.00,on the average,in the base year.
B) average price level currently is 125 times higher than the average price level during the base year.
C) purchasing power of a given money income is 25 percent larger during the base year than when the index was formulated.
D) purchasing power of money has increased 125 percent over time.

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