Use the table below to calculate the CPI in 2007.Assume the base year is 2006 and the cost of the market basket in the base year is $200.

The CPI in 2007 is
A) 100
B) 126
C) 115
D) 230
E) 200

Question

Use the table below to calculate the CPI in 2007.Assume the base year is 2006 and the cost of the market basket in the base year is $200.

The CPI in 2007 is
A) 100 
B) 126 
C) 115 
D) 230 
E) 200

Quizplus · Accepted Answer

To calculate the CPI in 2007, we need to follow the steps below:

1. Calculate the total cost of the market basket in 2007:
(6 x $2) + (4 x $4) + (3 x $3) + (2 x $6) = $31

2. Divide the total cost of the market basket in 2007 by the cost of the market basket in the base year:
$31 / $200 x 100 = 15.5

3. Therefore, the CPI in 2007 is 115 (rounded to the nearest whole number).

Use the Table Below to Calculate the CPI in 2007