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Which of the Following Statements Highlights the Difference Between the CPI

Question 2

Multiple Choice

Which of the following statements highlights the difference between the CPI (consumer price index) and the GDP deflator?


A) The CPI measures the average prices of inputs in the production process, whereas the GDP deflator measures the average prices of goods purchased by consumers.
B) The CPI measures the average prices of retail goods, whereas the GDP deflator measures the average prices of wholesale goods.
C) The CPI measures the average prices of typical goods consumed by consumers, whereas the GDP deflator measures the average prices of all goods consumed by all agents in the economy.
D) The CPI measures the average prices of all final goods consumed by consumers, whereas the GDP deflator measures the average prices of all inputs used in the economy.

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