The CPI was 196 in 2005,and the CPI was 96.5 in 1982.If your parents put aside $1,000 for you in 1982,then how much would you have needed in 2005 in order to buy what you could have bought with the $1,000 in 1982?

Question

Quizplus · Accepted Answer

To adjust for inflation, we need to use the CPI ratio between the two years: 196/96.5 = 2.03. This indicates that prices increased by a factor of 2.03 from 1982 to 2005. Therefore, $1,000 in 1982 would have the same purchasing power as $2,031.09 in 2005 (1,000 x 2.03). Therefore, the best choice is C.

The CPI Was 196 in 2005,and the CPI Was 96