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Q. Describe Consumer Price Index?
Consumer Price Index:Consumer price index (CPI) is a measure of overall price level paid by consumers for various services and goods they purchase. Retail price information is gathered on each type of product and then weighted according to its significance in overall consumer spending, to construct CPI. Annual or monthly changes in CPI provide a good measure of the rate of consumer price inflation.
Explain externality, how can government intervene to achieve allocative efficiency in case of external cost or external benefit? Answer The term externalities refers to bot
Prove that the utility approach and the indifference curve approach yield the same consumer equilibrium.
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