The consumer price index (CPI) is calculated by averaging the prices of various items after assigning a weight to each item. The following table gives the consumer price indexes for selected years from 1940 through 2002, reflecting buying patterns of all urban consumers. Find an equation that models these data and use it to determine when the consumer price index will pass 255. Source: U.S. Bureau of the Census

A)The 2004 - 2005 year
B)The 2005 - 2006 year
C)The 2007 - 2008 year
D)The 2009 - 2010 year
E)The 2012 - 2013 year

Question

The consumer price index (CPI) is calculated by averaging the prices of various items after assigning a weight to each item. The following table gives the consumer price indexes for selected years from 1940 through 2002, reflecting buying patterns of all urban consumers. Find an equation that models these data and use it to determine when the consumer price index will pass 255.  ​ Source: U.S. Bureau of the Census
​
A)The 2004 - 2005 year 
B)The 2005 - 2006 year 
C)The 2007 - 2008 year 
D)The 2009 - 2010 year 
E)The 2012 - 2013 year

Quizplus · Accepted Answer

A linear regression of the data yields the equation: CPI = 1.22t + 14.63, where t represents the years after 1940. Setting this equation equal to 255 and solving for t gives t = 187.70, or approximately 2010. Therefore, the consumer price index will pass 255 in the 2009 - 2010 year.

The Consumer Price Index (CPI) Is Calculated by Averaging the Prices