(ii) A heat exchanger is required to purchase for a naphtha cracking unit of a petrochemical industry. CEO of the industry wants to estimate the cost of the heat exchanger. But unfortunately, the supplier does not have the required data. At this point, CEO of the company predicts that, the estimation by using cost index data is most suitable to determine the cost. As a CEO of the company, explain why cost index is useful to calculate cost of the equipment?

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