1) which of the following statements is true about U.S. Rule?

1 answer:

3 0

1) --
2) --
3) 175,900 / 12.5% = 1,407,200 CHOICE B.
4) SUPPLIES
5) PURCHASES
6) 5,000 + 21,800 - 790 - 5,100 = 20,910 CHOICE D.
7) D. 50%
8) C. UNITS OF PRODUCTION
9) B. INCOME STATEMENT
10) A.) 6,480
11) D.) MULTIPLIED BY BOOK VALUE AT THE BEGINNING OF THE YEAR.

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The reasonable estimate of the current customer price index is 195. The option B is the correct option.

<h3>Customer price index</h3>

Customer price index is the price index which measures the weight average of price of basket of customers goods or services.

It can be given as,

$\rm CPI_t=\dfrac{C_t}{C_0}\times 100$

Here $\rm C_t$ is the cost of market basket in current period and $\rm C_0$ is the cost of market basket in the base period.

Cost of market basket in current period is

$\rm C_t=15.66+119.75+23.99+37.50\\\\C_t=196.9$

Cost of market basket in 1983 is,

$\rm C_0=8.85+71.25+13.95+22.7\\\\C_0=116.8$

Substitute all the values in the formula

$\rm CPI_t=\dfrac{C_t}{C_0}\times 100\\\\\rm CPI_t=\dfrac{196.9}{116.8}\times 100\\\\\rm CPI_t=1.685\times 100 \\\\ CPI_t=168.5\\\\\rm CPI_t= 170 \ \rm approx$