Scenario 16-2
The price tag on a golf ball in 1975 read $0.20,and the price tag on a golf ball in 2005 read $2.00.The CPI in 1975 was 52.3,and the CPI in 2005 was 191.3.
-Refer to Scenario 16-2.The price of a 1975 golf ball in 2005 dollars is

Question

Quizplus · Accepted Answer

To find the price of a 1975 golf ball in 2005 dollars, we need to adjust the 1975 price for inflation using the CPI. We can use the following formula:

Price in 2005 dollars = Price in 1975 dollars x (CPI in 2005 / CPI in 1975)

Plugging in the numbers from the scenario, we get:

Price in 2005 dollars = $0.20 x (191.3 / 52.3) = $0.73

Therefore, the price of a 1975 golf ball in 2005 dollars is $0.73.

Scenario 16-2 The Price Tag on a Golf Ball in 1975 Read