$$\begin{array}{l}
\begin{array} { | c | c | }
\hline \text { Good } & \begin{array} { c }
\text { Price Increase since } \
\text { Last Year }
\end{array} \
\hline \text { Amusement park tickets } & 5.0 \% \
\hline \text { Bowling balls } & 4.2 \% \
\hline \text { Camouflage neckties } & 3.1 \% \
\hline
\end{array}\
\text { Table } 8.1
\end{array}$$ Refer to Table 8.1,which gives hypothetical data on price changes for three goods.If the overall rate of inflation in the economy was 4.5%,which of the following statements is true?
A) The real price of all three goods increased.
B) The real price of amusement park tickets rose, and the real price of bowling balls and camouflage neckties fell.
C) The real price of amusement park tickets fell, and the real price of bowling balls and camouflage neckties rose.
D) The real price of all three goods decreased.

Question

$$\begin{array}{l}
\begin{array} { | c | c | } 
\hline \text { Good } & \begin{array} { c } 
\text { Price Increase since } \
\text { Last Year }
\end{array} \
\hline \text { Amusement park tickets } & 5.0 \% \
\hline \text { Bowling balls } & 4.2 \% \
\hline \text { Camouflage neckties } & 3.1 \% \
\hline
\end{array}\
\text { Table } 8.1
\end{array}$$ Refer to Table 8.1,which gives hypothetical data on price changes for three goods.If the overall rate of inflation in the economy was 4.5%,which of the following statements is true?
A) The real price of all three goods increased.
B) The real price of amusement park tickets rose, and the real price of bowling balls and camouflage neckties fell.
C) The real price of amusement park tickets fell, and the real price of bowling balls and camouflage neckties rose.
D) The real price of all three goods decreased.

Quizplus · Accepted Answer

The real price of a good adjusts for inflation, meaning it reflects the change in purchasing power. Amusement park tickets, which increased by 5.0%, rose more than the overall inflation rate of 4.5%, indicating a real price increase. Bowling balls and camouflage neckties, with increases of 4.2% and 3.1% respectively, had price increases less than the inflation rate, indicating their real prices fell.