Suppose a price index for a certain basket of goods and services has a value of 150 in 2018 and a value of 156 in 2019.This index suggests that the cost of the market basket of goods and services
A)was 4% higher in 2019 than in 2018.
B)was 6% lower in 2019 than in 2018.
C)was 6% higher in 2019 than in 2018.
D)was 156% higher in 2019 than in 2018.
E)was approximately the same in 2019 and 2018.

Question

Quizplus · Accepted Answer

The percentage increase in the price index from 2018 to 2019 is calculated as ((156 - 150) / 150) * 100% = 4%.

Suppose a Price Index for a Certain Basket of Goods