If the CPI rises,the number of dollars needed to buy a representative basket of goods
A)increases,and so the value of money rises.
B)increases,and so the value of money falls.
C)decreases,and so the value of money rises.
D)decreases,and so the value of money falls

Question

Quizplus · Accepted Answer

When the CPI (Consumer Price Index) rises, it indicates that the price level of a basket of goods has increased, meaning more dollars are needed to purchase the same goods. This results in a decrease in the purchasing power of money, or the value of money falls.

If the CPI Rises,the Number of Dollars Needed to Buy