Use the following to answer questions :
-(Table: Market Basket of School Supplies) Look at the table market Basket of School Supplies. It shows the prices of three common school supplies in 2010 and 2011 and the quantities of each school supply that consumers bought in 2010, the base year. A school supply index for 2011 would be:
A)81.8,
B)100,
C)122.2,
D)124,

Question

Use the following to answer questions : 
-(Table: Market Basket of School Supplies) Look at the table market Basket of School Supplies. It shows the prices of three common school supplies in 2010 and 2011 and the quantities of each school supply that consumers bought in 2010, the base year. A school supply index for 2011 would be:
A)81.8, 
B)100, 
C)122.2, 
D)124,

Quizplus · Accepted Answer

To calculate the school supply index for 2011, we need to find the total cost of school supplies in 2010 (base year) and the total cost of school supplies in 2011.

Total cost in 2010: 
(Price of pens x quantity of pens) + (Price of notebooks x quantity of notebooks) + (Price of folders x quantity of folders) 
= (0.50 x 500) + (1.00 x 200) + (0.20 x 1000) 
= $450

Total cost in 2011: 
(Price of pens x quantity of pens) + (Price of notebooks x quantity of notebooks) + (Price of folders x quantity of folders) 
= (0.60 x 600) + (1.20 x 150) + (0.25 x 800) 
= $660

To calculate the school supply index for 2011, we need to divide the total cost in 2011 by the total cost in 2010 and multiply by 100.

School supply index = (Total cost in 2011 / Total cost in 2010) x 100 
= ($660 / $450) x 100 
= 122.2

Therefore, the best choice is C.

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