Asked by JORDAN ESCOBAR on Jul 18, 2024
Verified
When economists refer to an economy's price level,they indicate:
A) the rate of inflation in that economy.
B) the prices of goods and services relative to consumers' incomes.
C) a composite measure of prices of all goods and services.
D) a period of level,or steady,prices in that economy.
E) the price of a specific consumer good.
Price Level
The mean of current prices for all goods and services created within the economy.
Rate of Inflation
The percentage increase in the general level of prices for goods and services in an economy over a given period.
- Ascertain the correlation between income, price levels, and the purchasing patterns of consumers.
Verified Answer
MA
Mariam AbdalaJul 22, 2024
Final Answer :
C
Explanation :
The price level refers to a composite measure of prices of all goods and services in an economy. This can be measured using price indices such as the Consumer Price Index (CPI) or the Producer Price Index (PPI). It is not necessarily indicative of inflation or the price of a specific consumer good.
Learning Objectives
- Ascertain the correlation between income, price levels, and the purchasing patterns of consumers.