Suppose an economy has only three goods and the typical family purchases the amounts given in the following table.If 2012 is the base year,then what is the CPI for 2017? $$\begin{array} { | c | c | c | c | c | c | }
\hline \text { Product } & \begin{array} { c }
\text { Quantity } \
\text { (2012) }
\end{array} & \begin{array} { c }
\text { Price } \
\text { (2012) }
\end{array} & \begin{array} { c }
\text { Expenditures } \
\mathbf { ( 2 0 1 2 ) }
\end{array} & \begin{array} { c }
\text { Price } \
\text { (2017) }
\end{array} & \begin{array} { c }
\text { Expenditures (on base } \
\text { year quantities) (2017) }
\end{array} \
\hline \text { Hair cuts } & 6 & \$ 50 & \$ 300 & \$ 80 & \$ 480 \
\hline \text { Backpacks } & 4 & \$ 25 & \$ 100 & \$ 30 & \$ 120 \
\hline \text { Tacos } & 100 & \$ 1.00 & \$ 100 & \$ 5.00 & \$ 500 \
\hline \text { Total } & & & \$ 500 & & \$ 1100 \
\hline
\end{array}$$

Question

Suppose an economy has only three goods and the typical family purchases the amounts given in the following table.If 2012 is the base year,then what is the CPI for 2017? $$\begin{array} { | c | c | c | c | c | c | } 
\hline \text { Product } & \begin{array} { c } 
\text { Quantity } \
\text { (2012) }
\end{array} & \begin{array} { c } 
\text { Price } \
\text { (2012) }
\end{array} & \begin{array} { c } 
\text { Expenditures } \
\mathbf { ( 2 0 1 2 ) }
\end{array} & \begin{array} { c } 
\text { Price } \
\text { (2017) }
\end{array} & \begin{array} { c } 
\text { Expenditures (on base } \
\text { year quantities) (2017) }
\end{array} \
\hline \text { Hair cuts } & 6 & \$ 50 & \$ 300 & \$ 80 & \$ 480 \
\hline \text { Backpacks } & 4 & \$ 25 & \$ 100 & \$ 30 & \$ 120 \
\hline \text { Tacos } & 100 & \$ 1.00 & \$ 100 & \$ 5.00 & \$ 500 \
\hline \text { Total } & & & \$ 500 & & \$ 1100 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The CPI for 2017 is calculated as (Expenditures in 2017 on base year quantities / Expenditures in base year) * 100 = (1100 / 500) * 100 = 220.

Suppose an Economy Has Only Three Goods and the Typical