Estimate the current year
Explanation of Solution
Current year consumer
Consumer price index (CPI) can be calculated using the following formula:
Current year consumer price index (CPI):
If the market basket consists of 10A and 20B with the current year prices of $2 and $4, respectively, and if the base year prices for A and B are $1 and $2.50, respectively, then the consumer price index can be calculated using Equation (1) as follows:
Thus, the value of the current year consumer price index (CPI) is 167.
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- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
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