In 1940 you could buy a "nickel Pepsi" for (oddly enough)a nickel.If the price index in 1940 was 14 and the 2011 price index was 221,then the inflation-adjusted price of a Pepsi would be
A) a nickel ($0.05).
B) a dime ($0.10).
C) about 79 cents ($0.79).
D) about $1.21.
E) $0.00317.

Question

Quizplus · Accepted Answer

To adjust for inflation, use the formula: (Price in 1940) * (Price Index in 2011 / Price Index in 1940). So, $0.05 * (221 / 14) = $0.79.

In 1940 You Could Buy a "Nickel Pepsi" for (Oddly