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EBK ECONOMICS: PRINCIPLES AND POLICY
13th Edition
ISBN: 8220100605932
Author: Blinder
Publisher: Cengage Learning US
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Question
Chapter 23.A, Problem 4TY
To determine
The college price index for 2013.
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Students have asked these similar questions
Examine the following information as reported for the foods below in the years 2010
and 2019.
2010
2019
Item
Price (S)
Quantity
Price (S)
Quantity
Eggs (one dozen)
$2.75
27
$3.37
40
Chicken (500 g)
$3.20
11
$3.57
7
Bread (675 g)
$2.28
18
$2.83
23
a) Compute a simple price index for each of the items, using the year 2010 as the
base year. Enter them in the same order as above: Eggs, Chicken, Bread. Round
answers to 1 decimal.
b) Compute a simple aggregate price index. Use 2010 as the base period. Round to
one decimal place.
c) Compute the Laspeyres price index for 2019 using 2010 as the base year. Round
to one decimal place.
d) Determine a value index for 2019, using 2010 as the base year. Round to one
decimal place.
The Consumer Price Index (CPI) is a measure of the
average change in price over time from a designated
reference period, at which it equals 100. The index is
based on prices of basic consumer goods and services.
The table provided lists the CPI for several years from
1960 to 2012. If the price change in cars parallels the
change in the CPI, what would a car sell for (to the
nearest dollar) in 2012 if a comparable model sold for
$7,500 in 1999?
Year
CPI
1960
29.6
1973
1986
44.4
109.6
156.9
1999
2012
229.6
In 2012, a car would sell for approximately $ 58,176
(Round to the nearest dollar.)
The Consumer Price Index is
Chapter 23 Solutions
EBK ECONOMICS: PRINCIPLES AND POLICY
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Similar questions
- Define the term Consumer Price Index?arrow_forwardYou are employed by the state bureau of economic development. There is a demand for a leading economic index to review past economic activity and to forecast future economic trends in the state. You decide that several key factors should be included in the index: number of new businesses started during the year, number of business failures, state income tax receipts, college enrollment, and the state sales tax receipts. Here are the data for 2000 and 2018. 2000 2018 New businesses 1,240 1,325 Business failures 600 496 State income tax receipts ($ millions) 185.2 220.8 College student enrollment 242,299 291,291 State sales tax ($ millions) 55.1 57.4 The weights you assign are: new businesses 15%, business failures 10%, income tax 42%, enrollment 13% and sales tax 20%. b. Compute the leading economic indicator for 2018. (Round your answer to 2 decimal places.) c. Interpret the indexes. (Round your answer to 2 decimal places.) Economic activity has (increased or decreased) _____%…arrow_forwardThe Consumer Price Index measures the overall level of prices faced by:arrow_forward
- Market Commodity Basket Milk Eggs Bread Quantity 10 gallons 10 dozen 10 loaves 2010 2011 Price price per per Unit unit $2.00 $2.50 $2.00 $3.00 $2.00 $3.00 Use the Table above to answer the following questions. (Where applicable, round your answers to two decimal places) a) If 2010 is the base year in the table shown above, the price index for the year 2010 is b) If 2010 is the base year in the table shown above, the price index for the year 2011 c) Considering the data in the table shown above and 2010 as the base year, the inflation rate in 2011 is %arrow_forwardHow can I find the Consumer Price Indexarrow_forwardSuppose that the index of wholesale-to-retail beef price index for 2018 was 1.35 and the base year of this index was 2006. Relative to 2006, beef prices in 2018 were higher(lower) and by how much?arrow_forward
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- Table 4.3 1970-2018 Consumer Price Index for All Urban Consumers (1983-100) Year Price Index Year 82.4 1990 90.9 1991 96.3 1992 1403 2002 Price Indes Year 130,7 2000 136.2 2001 177.1 1970 1971 40.5 1972 418 1982 179.9 1973 444 1983 100 1974 49.3 1975 53.8 1984 101.9 1994 1993 1445 2003 184 148.2 2004 1985 107.6 1995 1524 2005 1976 56.9 1986 109.6 1996 1569 2006 1977 60.6 1987 113.6 1997 160.5 2007 1978 65.2 1988 118.3 1998 163 1979 72.6 1989 124 1999 166.6 Source: Bureau of Laber Statistics, United States Department of Labor Price Index Year 38.8 1980 1981 $126,655.05 $100,172.2 Price Price Indes Year Indes 172.2 2010 218.1 2011 224.9 2012 229.6 2013 188.9 2014 2015 2016 210.1 1953 2016 207.3 2017 2008 2153 2018 245.1 251 2009 2143 Based on the table of CPI, calculate the following: Laura's salary was $100,000 in 2000. In order to maintain the same level of purchasing power in 2010 as she had in 2000, what should be her salary? $100,218.1 $63,650.05 234.8 237arrow_forwardThe variable-based index values of wholesale bread prices for the years 1987-2003 are given below. Given the given, what is the fixed basis wholesale bread price index for 2001? year variable-based index values of wholesale bread prices 1987 97 1988 63 1999 74 2000 113 2001 94 2002 147 2003 78arrow_forwardThe total price of purchasing a basket of goods in the United States over four years is: year 1=$940, year 2=$970, year 3=$1000, and year 4=$1070. Using year 2 as the base year, calculate the value of the price index in year 4.arrow_forward
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