Question

Assume the market basket for the consumer price index has two​ products, bread and​ milk, with the following values in 2013 and 2018 for price and​ quantity: Base Year​ (2013) 2018 Product Quantity Price Price Milk 50 ​$1.20 ​$1.50 Bread 100 1.00 1.10 The Consumer Price Index for 2018 equals A. 116. B. 85. C. 86. D. 118.

Answer 1

The market basket for the consumer price index has two​ products, bread and​ milk, with the following values in 2013 and 2018 for price and​ quantity: Base Year​ (2013) 2018 Product Quantity Price Price Milk 50 ​$1.20 ​$1.50 Bread 100 1.00 1.10 The Consumer Price Index for 2018 equals (A) 116

Explanation:

The market basket for the consumer price index has two​ products, bread and​ milk, with the following values in 2013 and 2018 for price and​ quantity: Base Year​ (2013) 2018 Product Quantity Price Price Milk 50 ​$1.20 ​$1.50 Bread 100 1.00 1.10 The Consumer Price Index for 2018 equals (A) 116

The CPI is a statistical technique that  estimate or make use of the prices of a sample of representative items and these prices are collected periodically.

The Consumer Price Index (CPI) is index which is used to  examine the weighted average price of  consumer goods and services  basket , which includes transportation, food, and medical care and  is calculated by taking price changes for each item in the predetermined basket of goods and averaging them out