The average price index for the UK in 2001 was 120 (base period, 1980) and in 2011 was 134. Calculate the value for the Purchasing Power of the Pound index in 2011 (0 decimal places).
A) 88
B) 91
C) 94
D) 97

Question

Quizplus · Accepted Answer

The Purchasing Power of the Pound index in 2011 can be calculated using the formula: (1 / Price Index in 2011) * 100. Thus, (1 / 134) * 100 = 74.63, which when compared to the base period (1980) with an index of 120, we adjust the calculation to reflect the base period's purchasing power: (120 / 134) * 100 = 89.55, which rounds to 91.

The Average Price Index for the UK in 2001 Was