Why is gasoline weighted more heavily than tomatoes in a calculation of the annual inflation rate in the United States?

a. Gasoline costs more to produce and purchase than tomatoes.

b. Gasoline is imported from other nations at a higher rate than tomatoes.

c. Americans purchase many more boxes of tomatoes than barrels of gasoline.

d. Americans spend more money on gasoline than tomatoes, on average.

Question

Social Studies

Walters

8 September, 15:07

Why is gasoline weighted more heavily than tomatoes in a calculation of the annual inflation rate in the United States?

a. Gasoline costs more to produce and purchase than tomatoes.

b. Gasoline is imported from other nations at a higher rate than tomatoes.

c. Americans purchase many more boxes of tomatoes than barrels of gasoline.

d. Americans spend more money on gasoline than tomatoes, on average.

+3

Answers (2)

Know the Answer?

Javon Jimenez · Answer 1

The correct answer is d. Americans spend more money on gasoline than tomatoes, on average.

Explanation:

The annual inflation rate in the United States is calculated based on the Consumer Price Index (CPI). This index is a weighted average of the prices of a fixed basket of consumer goods. The weights are meant to reflect the relative importance of the goods as measured by their shares in the average consumer's expenditure. The weight assigned to each good reflects the impact that a change on its price would have on the index as a whole.

Gordon Rogers · Answer 2

D on edge 2020