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1. Calculating Inflation using a simple price Index Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's

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1. Calculating Inflation using a simple price Index Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. Suppose table shows Information on the market basket for the CSPI and the prices of each of the goods in 2017, 2018, and 2019. The cost of each item in the basket and the total cost of the basket are shown for 2017. Perform these same calculations for 2018 and 2019, and enter the results in the following table. 2017 Price Cost (Dollars) (Dollars) 2018 Price Cost (Dollars) (Dollars) 2019 Price Cost (Dollars) (Dollars) Quantity in Basket 104 Notebooks Calculators Large coffees Energy drinks Textbooks 300 8 NN 720 1,575 Total cost Price index Suppose the base year for this price index is 2017. Price Index 1,575 100 Suppose the base year for this price index is 2017 In the last row of the table, calculate and enter the value of the CSP for the remaining years. Between 2017 and 2018, the CSP increased by Between 2018 and 2019, the CSP Increased by Which of the following. If true, would Illustrate why price indexes such as the CSPI might overstate Inflation in the cost of going to college? Check all that apply. As the price of energy drinks increased relative to the price of coffee between 2017 and 2019, students decreased their consumption of energy drinks and increased their consumption of coffee A new type of personal transporter, which made it easier to get around places like university campuses, became available for purchase. The quality of textbooks increased dramatically from 2017 to 2019, with textbook companies bundling new online study aids with their books, but this quality change is hard to measure Professors required each student to buy eight textbooks, regardless of the price

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