Consider a small economy in which consumers buy only two goods: apples and pears. In order to compute the consumer price index for this economy for two or more consecutive years, we assume thata. the number of apples bought by the typical consumer is equal to the number of pears bought by the typical consumer in each year. b.neither the number of apples nor the number of pears bought by the typical consumer changes from year to year. c.the percentage change in the price of apples is equal to the percentage change in the price of pears from year to year. d.neither the price of apples nor the price of pears changes from year to year.

The former chairman of the federal reserve, alan greenspan, used the term "irrational exuberance" in 1996 to describe the high levels of optimism among stock market investors at the time. stock market indexes such as the s& p composite price index were at an all-time high. some commentators believed that the fed should intervene to slow the expansion of the economy. why would central banks want to clamp down when the economy is growing? a. to block the formation of unsustainable speculative asset bubbles. b. to curtail excessive profits in the banking system. c. to prevent inflationary forces from gathering momentum. d. all of the above. e. a and c only.