Economics 0455 · IGCSE · Inflation and deflation

Inflation and deflation — practice question

Within the US Consumer Price Index (CPI), food carries a weighting of $13.7\%$. In India, food is given a weighting of $46.2\%$ in the CPI. What conclusion can be drawn from this?

  • AConsumers in India spend more on food than US consumers.
  • BFood is a bigger proportion of consumer spending in India than in the US.
  • CThe farming sector’s output of food is higher in India than in the US.
  • DThe price of food is rising more rapidly in India than in the US.

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