In 1979,in the face of rising competition in the fast food hamburger market,McDonald's reduced the price of its cheeseburger to $0.43.If the CPI in 1979 was 36 and the CPI in 2006 was 100,what is the price of a 1979 cheeseburger in 2006 dollars?
A)$0.99
B)$43.00
C)$1.19
D)$0.02
E)$0.15

Question

Quizplus · Accepted Answer

To find the price of a 1979 cheeseburger in 2006 dollars, we need to adjust the original price using the CPI ratio of 2006/1979:

Price in 2006 dollars = Price in 1979 dollars x (CPI in 2006/CPI in 1979)

Price in 2006 dollars = $0.43 x (100/36)

Price in 2006 dollars = $1.19

Therefore, the price of a 1979 cheeseburger in 2006 dollars is $1.19. Option C is the correct answer.

In 1979,in the Face of Rising Competition in the Fast