Table 20-3

-Refer to Table 20-3.Assume the market basket for the consumer price index has three products - Cokes,hamburgers,and CDs - with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals
A) 75.
B) 93.
C) 108.
D) 121.

Question

Table 20-3
 
-Refer to Table 20-3.Assume the market basket for the consumer price index has three products - Cokes,hamburgers,and CDs - with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals
A) 75. 
B) 93. 
C) 108. 
D) 121.

Quizplus · Accepted Answer

The Consumer Price Index (CPI) is calculated by taking the cost of the market basket in the current year (2011) and dividing it by the cost of the market basket in the base year (2006), then multiplying by 100. The given options suggest that the CPI for 2011 is 121, indicating that the cost of the market basket has increased by 21% from 2006 to 2011.

Table 20-3 -Refer to Table 20-3.Assume the Market Basket for the Consumer