Inaccuracies of the Consumer Price Index (CPI)
The Consumer Price Index is a measure of the prices of a fixed market basket of some 300 consumer goods and services purchased by a "typical" urban consumer. The 1982-1984 period serves as the base period so analysts can compare other year's changes with this base period. The composition of the market basket is fixed in the base period and is assumed not to change from one period to another. The reason for the assumption is because the CPI measures the costliness of a constant standard of living. Critics claim that the CPI is inaccurate because it overstates the increases in the cost of living. For this reason, the CPI has been said to be inaccurate.
First, consumers do change their spending patterns. Even though the composition off the market basket is assumed not to change, it does because consumers change their spending patterns. Because consumers substitute lower priced products in lieu of higher priced ones, the weight has shifted. The CPI assumes that this does not occur and therefore it overcompensates the standard of living.
Secondly, because the base period was over a decade ago, the quality of the products has increased significantly, and therefore the prices should be higher. The CPI, however, assumes that the increases in prices is a result of inflation rather than quality improvements which is false. Here also, the CPI overstates the rate of inflation.
Many consumers do not mind the overcompensation of the CPI because in most cases it means more money in their pockets, but there are some consequences.
This may cause an ongoing inflation trend. The reason why the government does not restrict it is because they are worried about getting re-elected. Even if the President does call for a revision of the CPI, Congress would defeat it to keep their positions.
Another consequence of the overstated CPI involves the adjustment of tax brackets. Their intent of indexing is to prevent inflation to cause people to be placed into a higher tax bracket. For example, if your income increases by 10%, that may put you in a higher level tax bracket, but if product prices have also
The American Civil War is one of the biggest turning points in American history. It marks a point of major separation in beliefs from the North and the South and yet somehow ends in a major unification that is now called the United States of America. It still to date remains the bloodiest war in American History. The book “This Republic of Suffering, death and the American Civil War” by Drew Gilpin Faust better explains the change in thought from the American people that developed from the unexpected mass loss in soldiers that devastated the American people. Throughout this review the reader will better understand the methods and theory of this book, the sources used, the main argument of the book, the major supporting arguments, and what the
Genetically modified? That alone should be a cause for alarm, and have you wondering, what exactly is in this that I am eating? Yet every day millions of American’s choose to load up on food filled with GMO’s, and not even know it. First we must understand what GMO’s are. GMO’s are any organism whose genetics has been altered using genetic engineering. We should not be tampering with nature, and should try to grow organically as much as possible. There has not been enough research on GMO’s to know the potential long term effects it can have on us, so this is why GMO’s should be banned.
After watching this film, I realized how little I knew about the American Civil War. The film provided me with more information about how many died as a result of this war and how this changed America completely. The civil war brought horrible modern conformation that included mass slaughter because “nearly two and a half percent of the population would die in the conflict -- an estimated 750,000 people in all -- more than in all other American wars combined” (“American Experience”). Never before, and never since, this war people
If the government changes the way they spend the budget, then they can change the way our government is ran. According to document C we spend 83% of the budget on “The Big Five”, which are the five main categories in the budget.We need to take 10%
In order to run more efficiently, there are certain responsibilities that Congress has given to the President over time. But that doesn’t mean Congress is losing any power or authority. It just means that they are giving up a responsibility that they don’t need. One of these responsibilities that were given to the President is the raising and lowering of tariffs. When it came to this issue, Congress can’t act decisively on its own. So even though Congress appropriates funds, they gave the President this fiscal responsibility. Again I want to stress that they didn’t lose any authority or power because of this. All they lost was a responsibility that they no longer have to worry about as it’s the President’s responsibility now. Still, the president has no authority or power regarding this issue. However, when he was given this fiscal responsibility, Congress also gave him staff assistance in the form of the Bureau of the Budget. This department helps the President make up the budget he wants to propose.
Jackson wrote several pieces of literature throughout her life, she is most known for her short story “The Lottery.” The lottery takes place in a small town on June 27th. The lottery is an annual event handled by Mr. Summers and the postman, Mr. Graves. The night before the lottery, Mr. Summers and Mr. Graves made slips of paper that are placed in an old black box that has been used for the lottery for a very long time. The children are the first to arrive for the lottery, then the men, followed by the women. As Mr. Summers calls the names of the families in the town, heads of the households, the men, come and draw slips of paper from the black box. During the lottery, Mrs. Adams mentions that the other towns are thinking of stopping their lottery, to which Old Man Warner responds it wil...
When we genetically modify an organism, we are creating an entirely new species. This can mean disaster for the surrounding natural organisms. These GM crops, which have been created to fight pests and weeds, can easily win in a competition for survival. Long-term effects include endangering these unmodified species, or even driving them to extinction. Another problem is that consumers don’t know when they’re eating GM foods. You might be allergic to fish, and then you go grocery shopping. You buy tomatoes to use in your dinner that night, with no knowledge that they have fish genes that can trigger your allergies. Allergic reactions to these modified foods are just another issue that comes up when GMOS come into play. Also, when we buy these foods, we’re supporting big industries that have patents on all these crops. The fact that people can patent crops just because they stuck some new DNA in them doesn’t make sense to begin with, but furthermore, the local, organic farmers who don’t want to, or can’t afford to pay these industries to use their patented crops are losing business.
This component is a good way to cut down on discretionary spending and save the country billions of dollars but it will a lot hurt the economy in a lot of ways. We need to elaborate on the reform, and not completely ignore the reform like Obama has been doing for the last three years.
Sickler, Melvin. "Should Congress Increase The Federal Minimum Wage And Index It To Inflation? (Cover Story)." Congressional Digest 92.5 (2013): 19. MasterFILE Premier. Web. 22 Nov. 2013
In Shirley Jackson’s “The Lottery,” the theme of the story is dramatically illustrated by Jackson’s unique tone. Once a year the villagers gather together in the central square for the lottery. The villagers await the arrival of Mr. Summers and the black box. Within the black box are folded slips of paper, one piece having a black dot on it. All the villagers then draw a piece of paper out of the box. Whoever gets the paper with the black dot wins. Tessie Hutchinson wins the lottery! Everyone then closes in on her and stones her to death. Tessie Hutchinson believes it is not fair because she was picked. The villagers do not know why the lottery continues to exist. All they know is that it is a tradition they are not willing to abandon. In “The Lottery,” Jackson portrays three main themes including tradition, treason, and violence.
"The Lottery," a short story written by Shirley Jackson, is a tale about a disturbing social practice. The setting takes place in a small village consisting of about three hundred denizens. On June twenty-seventh of every year, the members of this traditional community hold a village-wide lottery in which everyone is expected to participate. Throughout the story, the reader gets an odd feeling regarding the residents and their annual practice. Not until the end does he or she gets to know what the lottery is about. Thus, from the beginning of the story until almost the end, there is an overwhelming sense that something terrible is about to happen due to the Jackson's effective use of foreshadowing through the depiction of characters and setting. Effective foreshadowing builds anticipation for the climax and ultimately the main theme of the story - the pointless nature of humanity regarding tradition and cruelty.
Society’s reliance on smartphones has dramatically changed the way humans interact with one another. In the past, people
... Also important is the price of complements, or goods that are used together. When the price of gasoline rises, the demand for cars falls.
One method that Toyota can consider is using the price elasticity of demand to determine whether to increase or decrease the sale price of their automobiles. The responsiveness or sensitivity of consumers to a price change is measured by a product's price elasticity of demand (McConnell & Brue, 2004). Market goods can be described as elastic or inelastic goods as change in quantity demanded for that good. If demand is elastic, a decrease in price will increase total revenue. Even though a lower price would generate lower sales revenue per unit, more than enough additional units would be sold to offset lower price (McConnell & Brue, 2004). In a normal market condition, a price increase leads to a decreased demand, and a price decrease leads to increased demand. However, a change in income affecting demand is more complex.
Since social media users grow larger and larger, many companies take the opportunities of using social media marketing to reach more customers. Companies use social media marketing in order to achieve marketing communication and branding goals. Social media allows companies to see what prospects are saying about their brands and competitors. It also allows companies to build deeper relationships with existing customers that drives them to purchase again and again. Not only it can help them generate new leads, but it allows them to build deeper relationships with existing clients that drives them to purchase again and again. It has become common for businesses to branch out and experiment with multiple networks with the aim of reaching the maximum amount of costumers.