Question

Consider the following price indexes: 95 in 2011, 100 in 2012, 129 in 2913, 131 in 2014, and 160 in 2015. If the cost of the market basket in 2012 is $3,500, what is the cost of the same basket of goods and services in 2015?

Answer 1

If the cost of a market basket of goods and services is $3,500 in 2012, the cost of the same market basket in 2015 is $5,600.

What is the market basket?

According to common definitions, a market basket is a selected mix of goods and services.

The market basket is commonly used to track the price performance of a specific market or segment, especially with regard to inflation.

An example of a market basket is the Consumer Price Index (CPI).  The CPI is an estimate of the average change of price paid for a specific basket of goods and services over time.

Data and Calculations:

Date  Price Index

2011         95

2012      100

2013      129

2014       131

2015      160

Cost of market basket in 2012 = $3,500

Cost of market basket of goods and services in 2015 = $5,600 ($3,500/100 x 160)

Thus, if the cost of a market basket of goods and services is $3,500 in 2012, the cost of the same market basket in 2015 is $5,600.

Learn more about the consumer price index at brainly.com/question/1889164