The table below shows the current and base-year prices of different goods in a market basket.
The table shows that the price of the market basket in the current year is _____ higher than the price of the market basket in the base year.
?
Table 6.2
?
?
$$\begin{array} { c c c c }
\text { Product } & \begin{array} { c }
\text { Quantity in } \
\text { market basket }
\end{array} & \begin{array} { c }
\text { Price in } \
\text { base year } ( \$ )
\end{array} & \begin{array} { c }
\text { Price in } \
\text { current year } ( \$ )
\end{array} \
\hline \text { Bread } & 10 & 1.00 & 1.50 \
\text { Milk } & 5 & 1.00 & 2.00 \
\text { Gum } & 50 & 0.20 & 0.50
\end{array}$$
A)100 percent
B)50 percent
C)1 percent
D)200 percent

Question

The table below shows the current and base-year prices of different goods in a market basket.
The table shows that the price of the market basket in the current year is _____ higher than the price of the market basket in the base year.
?
Table 6.2
?
?
$$\begin{array} { c c c c } 
\text { Product } & \begin{array} { c } 
\text { Quantity in } \
\text { market basket }
\end{array} & \begin{array} { c } 
\text { Price in } \
\text { base year } ( \$ )
\end{array} & \begin{array} { c } 
\text { Price in } \
\text { current year } ( \$ )
\end{array} \
\hline \text { Bread } & 10 & 1.00 & 1.50 \
\text { Milk } & 5 & 1.00 & 2.00 \
\text { Gum } & 50 & 0.20 & 0.50
\end{array}$$
A)100 percent
B)50 percent
C)1 percent
D)200 percent

Quizplus · Accepted Answer

The total cost of the market basket in the base year is $ (10 \times 1.00) + (5 \times 1.00) + (50 \times 0.20) = 10 + 5 + 10 = 25 $. In the current year, it is $ (10 \times 1.50) + (5 \times 2.00) + (50 \times 0.50) = 15 + 10 + 25 = 50 $. The increase is $ \frac{50 - 25}{25} \times 100\% = 100\% $.

The Table Below Shows the Current and Base-Year Prices of Different