Question

The price tag on a golf ball in 1975 read $0.20, and the price tag on a golf ball in 2005 read $2.00. The 1913 was 32.3, and the CPI in 2005 was 191.3. In 1975 dollars, a 1975 golf ball cost $0.20 and a 2003 golu cost a. $0.55, so golf balls were cheaper in 1975. b. $0.55, so golf balls were cheaper in 2005. c. $7.32, so golf balls were cheaper in 1975. d. $7.32, so golf balls were cheaper in 2005.

Answer 1

The question is incomplete and incorrectly typed! The correct and complete question along with answer and explanation is provided below.

Question:

The price tag on a golf ball in 1975 read $0.20, and the price tag on a golf ball in 2005 read $2.00. The CPI in 1975 was 52.3, and the CPI in 2005 was 191.3. In 1975 dollars, a 1975 golf ball cost $0.20 and a 2005 golf ball cost

a. $0.55, so golf balls were cheaper in 1975.

b. $0.55, so golf balls were cheaper in 2005.

c. $7.32, so golf balls were cheaper in 1975.

d. $7.32, so golf balls were cheaper in 2005.

Answer:

a. $0.55, so golf balls were cheaper in 1975.

Explanation:

In 1975 dollars,

Price of golf ball in year 2005 x (CPI in 1975/CPI in 2005)

$2*(52.3/191.3) = 2 x 0.273 = 0.546 ≅ $0.55

So golf balls were cheaper in 1975 at the rate $0.20 as compared to $0.55.

Bonus:

If were asked to find the the price of 1975 golf ball in 2005 dollars, then

Price of golf ball in the year 1975 x (CPI in 2005/CPI in 1975)

$0.20*(191.3/52.3) = 0.20 x 3.65 = $0.73

so it means that in 1975 the price of golf ball would have $0.73 as compared to $2 in 2005 dollars.