Question
Given the information for a hypothetical market basket, calculate the Consumer Price Index for 2016 using 2016 as the base year. Then calculate the CPI
Given the information for a hypothetical market basket, calculate the Consumer Price Index for 2016 using 2016 as the base year. Then calculate the CPI for 2017 (again, using 2016 as the base year).
| Goods in Basket | Quantity Purchased | Prices in 2016 | Prices in 2017 |
| Milk | 20 | $2.00 | $3.50 |
| Bread | 10 | $1.00 | $2.50 |
| Oranges | 10 | $1.00 | $2.50 |
Now suppose the CPI is 210 in 2018. Calculate the rate of inflation from 2017 to 2018.
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Microeconomics For Today
Authors: Irvin B. Tucker
10th Edition
1337613061, 978-1337613064
