When the Consumer Price Index increases from 100 to 115
A)more money is needed to buy the same amount of goods, so the value of money falls.
B)more money is needed to buy the same amount of goods, so the value of money rises.
C)less money is needed to buy the same amount of goods, so the value of money falls.
D)less money is needed to buy the same amount of goods, so the value of money rises.

Question

Quizplus · Accepted Answer

When the Consumer Price Index (CPI) increases, it indicates that the average level of prices for goods and services has risen, meaning consumers need more money to buy the same amount of goods. This effectively reduces the purchasing power of money, indicating that the value of money falls.

When the Consumer Price Index Increases from 100 to 115