question 16 of 25\nwhen the consumer price index (cpi) decreases from 200 to 150, prices decrease by…

question 16 of 25\nwhen the consumer price index (cpi) decreases from 200 to 150, prices decrease by 25%.\na. true\nb. false

question 16 of 25\nwhen the consumer price index (cpi) decreases from 200 to 150, prices decrease by 25%.\na. true\nb. false

Answer

Explanation:

Step1: Calculate price - change percentage formula

The formula for percentage change in price using CPI is $\text{Percentage change}=\frac{\text{Initial CPI}-\text{Final CPI}}{\text{Initial CPI}}\times100%$.

Step2: Substitute values

Initial CPI = 200, Final CPI = 150. So, $\frac{200 - 150}{200}\times100%=\frac{50}{200}\times100%$.

Step3: Simplify the expression

$\frac{50}{200}\times100% = 0.25\times100%=25%$. Since the CPI decreased, it means prices decreased by 25%.

Answer:

A. True