$$\begin{array} { c c c c }
\text { Item } & \begin{array} { c }
\text { Quantity } \
( 2009 )
\end{array} & \begin{array} { c }
\text { Price } \
( 2009 )
\end{array} & \begin{array} { c }
\text { Price } \
( 2010 )
\end{array} \
\hline \text { Salt } & 2 & \$ 1.00 & \$ 2.00 \
\text { Bread } & 20 & \$ 2.50 & \$ 3.00 \
\hline
\end{array}$$
-The data in the table above shows the consumption by families in a small (poor) economy.The families consume only salt and bread.The reference base period is 2009.The CPI in 2010 is

Question

$$\begin{array} { c c c c } 
\text { Item } & \begin{array} { c } 
\text { Quantity } \
( 2009 )
\end{array} & \begin{array} { c } 
\text { Price } \
( 2009 )
\end{array} & \begin{array} { c } 
\text { Price } \
( 2010 )
\end{array} \
\hline \text { Salt } & 2 & \$ 1.00 & \$ 2.00 \
\text { Bread } & 20 & \$ 2.50 & \$ 3.00 \
\hline
\end{array}$$
-The data in the table above shows the consumption by families in a small (poor) economy.The families consume only salt and bread.The reference base period is 2009.The CPI in 2010 is

Quizplus · Accepted Answer

To calculate the CPI, we need to use the formula:

$	ext{CPI} = \frac{	ext{Cost of basket in current year}}{	ext{Cost of basket in base year}} 	imes 100$

We can first calculate the cost of the basket in each year:

$	ext{Cost of basket in 2009} = 2(\$1.00) + 20(\$2.50) = \$52.00$

$	ext{Cost of basket in 2010} = 2(\$2.00) + 20(\$3.00) = \$62.00$

Plugging in these values into the CPI formula gives:

$	ext{CPI} = \frac{\$62.00}{\$52.00} 	imes 100 \approx \boxed{123.1}$

Therefore, the CPI in 2010 is 123.1, which means that prices increased by about 23.1% compared to the base year. The correct answer is (C).

-The Data in the Table Above Shows the Consumption by }