Sort the statements into the appropriate bin. CPI GDP deflator Both Neither Is a

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Sort the statements into the appropriate bin. CPI GDP deflator Both Neither Is a weighted average of prices. Calculated using the prices of all goods and services produced domestically. Includes the prices and quantities of goods produced domestically and sold to foreign consumers. Is subject of biases because Is often used to index Equals the nominal interest rate it does not reflect changes union wage contracts. minus the real interest rate. in buying patterns. Is based on commonly used consumer goods only -O Previous Give Up & View Solution 9 Check AnswerNextExit Hint

Explanation / Answer

Cpi - weighted average of prices, based of commonly used consumer goods

GDP deflator does not include buying pattern, calculated using price of domestically produced goods and services.

Neither is used as index for wage contracts, domestically produced and sold to foreign countries, nominal - real interest rate.

Nominal - real interest rate is inflation.

Cpi or consumer price index measures price of good and services bought by consumers whereas GDP deflator measures price of goods and services produced in a country.

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