Suppose a market basket of goods and services costs $1,000 in the base year and the consumer price index (CPI) is currently 110. This indicates the price of the market basket of goods and services is now

Question

Quizplus · Accepted Answer

The CPI measures the price level of a market basket of goods and services from a base year to a current year. Since the CPI is currently 110 and the market basket cost $1,000 in the base year, the price of the market basket of goods and services is now $1,100 (110% of $1,000). So, the answer is C.

Suppose a Market Basket of Goods and Services Costs $1,000