Assume that there was a 5 percent increase in the price of all goods in 2015; if the base year is 2014, then the price index in 2015 will be
A) 95.
B) 105.
C) 110.
D) 1100.

Question

Quizplus · Accepted Answer

If there was a 5 percent increase in the price of all goods in 2015, this means that prices in 2015 are 105 percent of prices in 2014. Therefore, the price index in 2015 would be 105.

Assume That There Was a 5 Percent Increase in the Price