How is the purchasing power of the dollar computed?
A) ($1/CPI) (100)
B) ($1 - CPI) (100)
C) ($1 x CPI) (100)
D) (CPI/$1) (100)
E) ($1 + CPI) (100)

Question

Quizplus · Accepted Answer

The purchasing power of the dollar is calculated using the formula ($1/CPI) (100), where CPI stands for the Consumer Price Index. This formula helps determine how much goods and services $1 can buy relative to a base year.

How Is the Purchasing Power of the Dollar Computed