Suppose that 1983 is the base year for the Consumer Price Index (CPI)and in 2014 the CPI was 220.What does this "220" mean?
A)What cost $100 in 1983 on average cost 2.20 times as much in 2014.
B)What cost $100 in 1983 on average cost $220 more in 2014.
C)What cost $100 in 1983 on average cost 0.22 times as much in 2014 (that is,it cost $22 in 2014).
D)What cost $100 in 1983 on average cost $22 more in 2014.

Question

Quizplus · Accepted Answer

The CPI of 220 in 2014 means that the average price level of goods and services in 2014 was 2.20 times higher than the average price level of goods and services in the base year of 1983. Therefore, option A is the correct choice.

Suppose That 1983 Is the Base Year for the Consumer