Footwear Prices Rise at Fastest Rate in 5 Months

Correct! - The relative price of kid’s footwear with respect to men’s footwear is the money price of kid’s footwear divided by the money price of men’s footwear. The relative price of kid’s footwear with respect to women’s footwear is calculated similarly. The money price of kid’s footwear rose and the money price of men’s footwear fell, so the relative price of kid’s footwear with respect to men’s footwear rose. The money price of women’s footwear rose by more than the money price of kid’s footwear rose, so the relative price of kid’s footwear with respect to women’s footwear fell.

Well Done! - The opportunity cost of buying a pair of running shoes is the best alternative forgone, which equals the relative price of a pair of running shoes—2 pairs of sandals.