Question

Which of these is an economic indicator used to tell how an economy is doing?

Answer 1

The correct answer is B. Consumer Price Index.

It is great for showing the development of inflation. The remaining two are most commonly the employment rate, and the famous GDP which shows the production of a country. Unlike the GDP, the CPI focuses more on consumers and less on the economy.

Answer 2

Consumer Price Index is an economic indicator used to tell how an economy is doing.

Further Explanation:

Economic Indicator is the indicator that tells us about how an economy is doing. It tells us about the economy is at which phase (like depression, recession, peak, and expansion). With the help of economic indicators, the government knows about the phase in which the country is going to be.

Justification for the correct and incorrect answer:

A.  

Equilibrium Price: This option is incorrect.  

It is the price determined by the supply and demand of a good. The interaction at which demand and supply of a particularly good meet, that point is known as equilibrium price. As it only determines the price of the good, it is not the correct measure of the economic indicator.  

B.

Consumer Price Index: This option is correct.  

It shows how the price changes in a particular period. It is helpful in the prediction of the future trends of a particular good. It is the correct indicator of measuring the economy.

 

C.

Job Satisfaction Rate: This option is incorrect.  

This rate shows how people feel satisfied, self-motivated, and happy with their jobs. It doesn’t have any numerical value. It is related to the economy, but it cannot be quantified. Therefore, it is not the correct measure of the economic indicator.    

D.

Presidential Approval Rate: This option is incorrect.  

It is the rate of polling the opinion for a particular program or in favor of a person. The economy is not defined by the polling method because it is uncertain and follows uncertain trend. So, it is not a correct measure of the economic indicator.    

Learn more:

1. Learn more about the demand equilibrium  

       brainly.com/question/2656746

2. Learn more about the consumer price index

       brainly.com/question/2656746

3. Learn more about the equilibrium price

       brainly.com/question/4455515

Answer details:

Grade: Middle School

Subject: Economics

Chapter: Economic Indicator

Keywords:  Economic Indicator used, an economy is doing, equilibrium price, job satisfaction rate, presidential approval rate, to tell how.