During Year 1, the price of a barrel of oil rose from $60 to $110. In Year 2, it rose again, this time to $115 per barrel. Assume that any changes in oil prices affect the general price level immediately. What effect will the oil-price movements have on a country’s Consumer Price Index and on its inflation rate in Year 2, compared with Year 1?
- ACPI decrease; rate of inflation decrease
- BCPI decrease; rate of inflation increase
- CCPI increase; rate of inflation decrease
- DCPI increase; rate of inflation increase