Suppose the CPI in 1990 is 500,with 1967 as the base year.On average,how much money must be spent in 1990 to purchase the same quantity of goods and services that could have been bought with $10 in 1967?

Question

Quizplus · Accepted Answer

The CPI of 500 in 1990 means that prices have increased by a factor of 5 since 1967 (since the base year CPI is 100). Therefore, $10 in 1967 would be equivalent to $10 * 5 = $50 in 1990.

Suppose the CPI in 1990 Is 500,with 1967 as the Base