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Unformatted text preview: natural disaster of that magnitude, the billions of dollars spent in reconstruction would certainly have bumped the GDP up for that quarter and probably that year. However, the quality of life of those affected by the hurricane would definitely be undesirable. Chapter 24 Question 1. Which do you think has a greater effect on the Consumer Price Index: a 10% increase in the price of chicken or a 10% increase in the price of caviar? Why? The consumer price index (CPI) is calculated with a fixed market basket of goods that is averaged over a period of time. A 10% increase in the price of chicken would have a greater effect on the CPI because a majority of people have chicken in their basket....
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This note was uploaded on 03/25/2012 for the course ECO 101 taught by Professor Lindsey during the Spring '12 term at Post.
- Spring '12