Every unit of good x that is produced in the United States is exported to other countries.An increase in the price of good x shows up
A)in the consumer price index and in the GDP deflator.
B)in the consumer price index,but not in the GDP deflator.
C)in the GDP deflator,but not in the consumer price index.
D)in neither the consumer price index nor in the GDP deflator.

Question

Quizplus · Accepted Answer

The GDP deflator includes prices of all domestically produced goods, including exports, while the consumer price index (CPI) includes prices of goods consumed domestically. Since good x is exported, its price change affects the GDP deflator but not the CPI.

Every Unit of Good X That Is Produced in the United