Refer to the diagram below: For this process,the C_p index would be: A) less than one. B) equal to one. C) greater than one.

Question

Quizplus · Accepted Answer

The C_p index is calculated by dividing the cost of goods sold (CS) in period 1 (U1) by the cost of goods sold in period 0 (U0) multiplied by the price index in period 1 (P1) divided by the price index in period 0 (P0) and then multiplying by the quantity index in period 1 (S1) divided by the quantity index in period 0 (S0). Based on the diagram, the values for CS, P, and S in period 1 are all greater than the values in period 0, which means the C_p index will be greater than 1.

Refer to the Diagram Below: for This Process,the Cp

Refer to the Diagram Below: for This Process,the C_p