Suppose a basket of goods and services has been selected to calculate the consumer price index (CPI)and 2002 has been chosen as the base year.In 2002,the basket's cost was $76.00; in 2004,the basket's cost was $79.50; and in 2006,the basket's cost was $85.00.The value of the CPI was
A) 100 in 2002.
B) 108 in 2004.
C) 120 in 2006.
D) at least 118 in 2007.
E) no more than 90 in 2001.

Question

Quizplus · Accepted Answer

The CPI in the base year (2002) is always set to 100.

Suppose a Basket of Goods and Services Has Been Selected