i. Millions of employees in automobile, steel and other industries have their wages adjusted upward when the CPI increases. The specifics are in the management-union contracts. These clauses in the contracts are referred to as "cola clauses." ii. When two or more series of index numbers to be compared do not have the same base period, we select a common base period for all series. Then we use the respective base numbers as the denominators and convert each base to the new base.
iii. The largest component of the Canadian CPI is Food.
A) (i), (ii), and (iii) are all correct 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) (i), (ii), and (iii) are all false statements

Question

Quizplus · Accepted Answer

Statement (i) is correct as "cola clauses" are commonly included in management-union contracts to adjust employee wages based on CPI increases. Statement (ii) is correct as it is a standard practice to select a common base period for comparison when series of index numbers do not have the same base period. However, statement (iii) is incorrect as the largest component of the Canadian CPI is actually Shelter, not Food.

I Millions of Employees in Automobile, Steel and Other Industries