If the Consumer Price Index (CPI)had a value of 128 in year Z,this means that during the period between the base year and year Z:
A) All prices increased by 28 percent.
B) All prices increased by an average of 1.28 percent.
C) Prices of goods and services that the typical consumer buys increased by an average of 28 percent.
D) Prices of goods and services that the typical consumer buys increased by an average of 128 percent.

Question

Quizplus · Accepted Answer

CPI measures the changes in the prices of goods and services that the typical consumer buys. Therefore, a CPI value of 128 means that the prices of goods and services that the typical consumer buys increased by an average of 28 percent from the base year to year Z.

If the Consumer Price Index (CPI)had a Value of 128