An important difference between the GDP deflator and the consumer price index is that
A) the GDP deflator reflects the prices of goods and services bought by producers, whereas the consumer price index reflects the prices of goods and services bought by consumers.
B) the GDP deflator reflects the prices of all final goods and services produced domestically, whereas the consumer price index reflects the prices of some goods and services bought by consumers.
C) the GDP deflator reflects the prices of all final goods and services produced by a nation's citizens, whereas the consumer price index reflects the prices of final goods and services bought by consumers.
D) the GDP deflator reflects the prices of all goods and services bought by producers and consumers, whereas the consumer price index reflects the prices of final goods and services bought by consumers.

Question

Quizplus · Accepted Answer

The GDP deflator includes all final goods and services produced domestically, while the CPI focuses on a basket of goods and services bought by consumers.

An Important Difference Between the GDP Deflator and the Consumer