Basket of Goods

End of Year Prices

2017

2018

2019

10 kg apples

1.2/kg

1.4/kg

1.2/kg

5 kg oranges

2.2/kg

2.5/kg

2.5/kg

3 kg potatoes

0.2/kg

0.4/kg

0.5/kg

7 kg tomatoes

0.3/kg

0.4/kg

0.4/kg

1. If 2017 is the base year, what is the Price Index in 2017, 2018, 2019?

2.If 2018 is the base year, what is the price index in 2017, 2018, 2019?

3. If 2017 is the base year, what is the rate of inflation in 2018, 2019?

4.Did the cost of living increase or decrease in 2018, 2019? Explain in words why your

answer makes sense (Show all your calculations).