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Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Please answer the questions 17)

Transcribed Image Text:16) The table below shows the price index for China starting in 2000.
Year
2000
Price Index
100.0
2001
100.73
2002
99.95
101.12
2003
2004
105.06
2005
106.95
2006
108.52
The inflation rate between 2004 and 2005 was
A) 3.9 percent
B) 2.8 percent
C) 1.8 percent
D) 0.7 percent.
17) Price indexes can overstate inflation because they
A) omit some quality improvements.
B) do not contain the prices of any used goods.
C) do not contain the prices of foreign goods.
D) do not contain the prices of services.
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