alleryStart learning →A simple average of prices is misleading because:
ASome products matter more
BAll prices rise equally
CWages never change
DTaxes are excluded
Answer & Solution
Correct answer: A. Some products matter more
1. Rent matters more than carrots.
2. Some products take a bigger share of income.
3. So economists use a weighted average.
_Source: OpenStax Principles of Macroeconomics for AP Courses 2e, Chapter 8, Inflation (CC BY 4.0)._
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