A consumer expenditure survey reports the following information on entertainment spending:
Using 2015 as the base year, by how much does a "cost of entertainment" index increase between 2015 and 2016?
A)3.9 percent
B)8.6 percent
C)13.4 percent
D)29.4 percent

Question

A consumer expenditure survey reports the following information on entertainment spending:   
Using 2015 as the base year, by how much does a "cost of entertainment" index increase between 2015 and 2016?
A)3.9 percent 
B)8.6 percent 
C)13.4 percent 
D)29.4 percent

Quizplus · Accepted Answer

The entertainment cost in 2015 was (5 × $7)+ (2 × $30)+ (7 × $16)= $207. Entertainment cost in 2016 was (5 × $8)+ (2 × $35)+ (7 × $15)= $215, so the entertainment price index is 1.039, or an increase of 3.9 percent.

A Consumer Expenditure Survey Reports the Following Information on Entertainment