1. The inflation or deflation rate is A. the change in a price index divided by the initial value of the index. B. the change in a price index divided by the new index number. C. the difference between the initial price index number and the new price index number. D. computed by dividing the old price index number by the new price index number. E. the rate of change in real GDP from year to year. Year Consumer Price Index 1 80 2 (base year) 100 3 105 4 125 150 2. According to the table above, the approximate rate of inflation in Year 3 is percent. A. 1 B. 10 C. 19 D. 20 E. 5 3. The consumer price index reflects the: A. changes in the prices of goods and services typically purchased by consumers. B. level of prices for intermediate goods and services purchased by business. C. level of prices for raw materials. D. prices of all goods and services computed from the ratio of nominal GDP to real